Authority: National Company Law Tribunal Principal Bench, New Delhi

Order Date: 08 June 2026

Case Overview

The National Company Law Tribunal (NCLT) Principal Bench, comprising Justice Anupinder Singh Grewal (Hon'ble President) and Shri Ravindra Chaturvedi (Hon'ble Member - Technical), heard an application (IA 5617/2024) in the main petition CP No. IB 681 (ND)/2024. The petition was filed under Section 95(1) of the Insolvency and Bankruptcy Code, 2016 (IBC) by UV Asset Reconstruction Company Ltd. (UVARCL/Financial Creditor) seeking initiation of a Personal Insolvency Resolution Process (PIRP) against Captain Manoj Airon (Respondent/Personal Guarantor), the personal guarantor for corporate debtor Harvest Hotels and Serviced Apartments Pvt. Ltd.

The financial debt originated from various facilities (Term Loans, Funded Interest Term Loans, Working Capital Term Loan, Bank Guarantees) availed by the corporate debtor from State Bank of Patiala (now SBI), Central Bank of India, and Allahabad Bank. Captain Manoj Airon, along with others, executed personal guarantees to secure these facilities. A Master Restructuring Agreement (MRA) was executed on 29 December 2014, pursuant to which the Respondent executed a further deed of Personal Guarantee dated 29 December 2014, acknowledging an outstanding debt of Rs. 101.25 crores.

The corporate debtor's account was classified as a Non-Performing Asset (NPA) on 30 April 2017. The debt was subsequently assigned by the original lenders to Asset Reconstruction Company (India) Ltd. (ARCIL) via assignment deeds in July and September 2019. ARCIL issued a Recall Notice on 24 May 2021 for Rs. 170,82,74,727/- as of 30 April 2021. On 26 April 2023, ARCIL assigned the entire debt to the petitioner, UVARCL, which then issued a demand notice on 07 June 2024 for Rs. 258,92,81,114/- as of 31 May 2024.

The petition sought initiation of PIRP for a debt of Rs. 2,63,93,04,144/- as of 25 July 2024. The tribunal had appointed Mr. Shailesh Chandra Ojha (IBBI/IPA-001/IP-P-02859/2023-2024/14382) as the Resolution Professional (RP) on 14 October 2024. The RP submitted a report under Section 99 of the IBC recommending admission of the petition.

The Personal Guarantor raised two primary objections against admission:

1. Limitation: Contended the petition was barred by limitation, arguing the cause of action commenced with a SARFAESI notice dated 28 May 2018. He denied receiving the demand notice dated 28 April 2022 and argued that acknowledgements by the corporate debtor (Undertaking dated 22.08.2019, Declaration-cum-Undertaking dated 29.07.2021) were not binding on him.

2. Guarantee Withdrawal: Contended he had withdrawn from the personal guarantee through letters and telephonic communications (dated 10.04.2015, 14.04.2015, 23.04.2015, 02.11.2017, 22.11.2017) and his resignation from the corporate debtor's directorship on 06 April 2015. He also alleged the guarantee was only for a specific FITL that never materialized and that banks fraudulently used undated signed documents.

The Financial Creditor countered that the guarantee was irrevocable, unconditional, and continuing, as per Clauses 4.1 and 19 of the Guarantee Deed. It argued that any acknowledgement by the corporate debtor was binding on the guarantor under Clause 27.1 of the deed, effectively extending limitation. It also asserted that unilateral withdrawal attempts were legally untenable and required express discharge by the creditor, which never occurred.

Final Outcome

The NCLT admitted the petition under Section 95(1) of the IBC and initiated the Insolvency Resolution Process against Captain Manoj Airon. The interim moratorium under Section 96(1) ceased, and a fresh moratorium under Section 101 was declared for 180 days or until an order under Section 114 is passed. The Tribunal rejected the PG's objections, holding that:

  • The petition was not barred by limitation due to the continuing nature of the guarantee and acknowledgements by the corporate debtor (binding on the guarantor per the deed).
  • The defence of guarantee withdrawal was untenable as the deed was irrevocable, and resignation from directorship does not discharge contractual guarantee obligations.

Mr. Shailesh Chandra Ojha was confirmed as the Resolution Professional and directed to publish a public notice inviting claims, prepare a list of creditors, and assist in preparing a repayment plan. The Financial Creditor was ordered to deposit Rs. 1,00,000/- with the RP for expenses. Captain Manoj Airon was directed to cooperate fully with the RP and disclose complete details of his assets and liabilities (as on the order date, 31 March 2024, and 31 March 2025), supported by Income Tax Returns, within two weeks.

Topics: Personal Guarantor Insolvency, Debt Assignment, Continuing Guarantee