Case Details

Case Name: Nagaraj CM & Arun Kumar HP vs Sir M. Visvesvaraya Co-operative Bank Ltd

Court/Authority: National Company Law Appellate Tribunal, Chennai (Appellate Jurisdiction)

Case Numbers: Company Appeal (AT) (CH) (Ins) No.175/2026 (with IA No. 517/2026), Company Appeal (AT) (CH) (Ins) No.157/2026, and IA No.256/2026 in Company Appeal (AT) (CH) (Ins) No. 88/2026

Date of Order: Not explicitly stated in provided text

Period of Violation/Dispute: Default by Corporate Debtor determined as 31 July 2018; Guarantee invoked on 10 June 2022; Demand notice issued 17 December 2022

Parties Involved

Petitioners/Appellants:

  • Nagaraj CM (in Company Appeal No.175/2026 and 157/2026)
  • Arun Kumar HP (in IA No.256/2026)

Respondent: Sir M. Visvesvaraya Co-operative Bank Ltd

Legal Representatives:

  • For Appellants: Ms. Ayusshi Agarwal, Advocate; Mr. Pranav V Shankar, Advocate; Mr. S. Ravi, Senior Advocate; Mr. S. Vivekananda, Advocate
  • For Respondent: Mr. G. Rishi Srinivas & Ms. T. Poornima Devi, Advocates

Tribunal Members: Justice Sharad Kumar Sharma (Member Judicial), Jatindranath Swain (Member Technical)

Issues / Allegations / Violations

The core issue concerns the limitation period for initiating insolvency proceedings under Section 95 of the Insolvency and Bankruptcy Code, 2016 against personal guarantors.

The Appellant contended that the proceedings were time-barred because the limitation period should be calculated from the date of default by the Corporate Debtor (31 July 2018), not from the date of guarantee invocation (10 June 2022). This interpretation would make the proceedings barred by limitation.

Findings & Observations

The Tribunal rejected the Appellant's limitation argument based on the following legal reasoning:

  • Referenced the Supreme Court judgment in Syndicate Bank Vs. Channaveerappa Beleri & Ors. (2006) 11 SCC 506, particularly paragraph 14
  • Applied the Supreme Court's COVID-19 limitation extension order from MA/21/2022 in MA/665/2021 in Suo Motu Writ Petition (C) No.3 of 2020
  • The limitation period was extended from 15 March 2020 to 28 February 2022 due to COVID-19
  • Further extended from 28 February 2022 for the actual balance period remaining or 90 days, whichever is greater
  • The demand notice dated 17 December 2022 was prima facie within this extended limitation period
  • The Tribunal found the Appellant's interpretation of limitation unacceptable

Penalties / Settlements / Directions

The Tribunal rejected the interim relief application (IA No.256/2026) seeking stay on the operation of the impugned order that admitted proceedings under Section 95 of I&B Code, 2016 against the Appellant/Personal Guarantor.

No monetary penalties or settlements were imposed in this interim order. The rejection means the Section 95 proceedings against the personal guarantor will continue without stay.

Final Ruling & Enforcement

The interim relief application IA No.256/2026 was rejected. The Tribunal did not grant stay on the effect and operation of the impugned order that admitted proceedings under Section 95 of I&B Code, 2016 against the Appellant/Personal Guarantor.

The main appeals (Company Appeal Nos.175/2026, 157/2026, and 88/2026) appear to remain pending for final hearing and determination.