Authority: National Company Law Tribunal, Hyderabad Bench-I

Order Date: 18 June 2026

Case Overview

The State Bank of India (SBI) filed an application under Sections 121 and 123 of the Insolvency and Bankruptcy Code, 2016, read with Rule 7 of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Bankruptcy process for Personal Guarantors to Corporate Debtors) Rules, 2019. The application sought to initiate bankruptcy proceedings against Mr. Sandeep Kumar Agarwal, the personal guarantor for corporate debtor M/s Nikhil Refineries Private Limited.

The dispute originated from credit facilities sanctioned by SBI to Nikhil Refineries. Facilities were initially sanctioned for ₹77 crores on 23 April 2010 and later enhanced to ₹100.80 crores on 28 March 2011. Mr. Agarwal executed a Deed of Guarantee on 21 April 2011 to secure the repayment. The corporate debtor defaulted, leading SBI to declare the account as a non-performing asset (NPA).

SBI initiated recovery proceedings by filing OA No.1378 of 2017 before the Debt Recovery Tribunal (DRT), Hyderabad. The DRT issued Recovery Certificate No.43/2023 on 9 February 2023, making the corporate debtor and the personal guarantor jointly and severally liable.

The total default amount claimed is ₹143,18,04,433 (One Hundred Forty Three Crores Eighteen Lakhs Four Thousand Four Hundred Thirty Three Rupees), comprising a principal of ₹52,90,87,234.3 (Fifty Two Crores Ninety Lakhs Eighty Seven Thousand Two Hundred Thirty Four Rupees and Three Paise) and interest of ₹90,27,17,198.7 (Ninety Crores Twenty Seven Lakhs Seventeen Thousand One Hundred Ninety Eight Rupees and Seven Paise), calculated until 31 January 2026.

SBI had previously filed CP(IB) No.171/95/HDB/2024 under Section 95 of the IBC against the guarantor. The NCLT admitted Mr. Agarwal into insolvency proceedings via order dated 4 March 2025. As no repayment plan was submitted, the Resolution Professional filed IA(IBC) No. 1450/2025, seeking closure of insolvency and permission to initiate bankruptcy. The NCLT allowed this application on 18 November 2025, granting SBI liberty to file the present bankruptcy application.

The respondent was set ex-parte as there was no appearance despite service of notice. The tribunal found the application admissible since no repayment plan was submitted and no resolution existed for resolving the insolvency.

Final Outcome

The NCLT allowed the application and declared Mr. Sandeep Kumar Agarwal of 266, A/B, MLA Colony, Road No.12, Banjara Hills, Hyderabad-500034, as BANKRUPT.

Mr. Murali Mohan Chevuturi (IBBI Regn. No. IBBI/IPA-003/IP-N00307/2020-2021/13464) was appointed as the Bankruptcy Trustee under Section 125 of the Code. His address is Flat No.201, Dream Home Vasista, Plot No.9, Barafbagh Colony, Lower Tankbund Road, Hyderabad – 500029. His email is mohan.chevuturi@gmail.com, and mobile number is 8978844588. His Authorisation for Assignment (AFA) is valid until 30 June 2026.

The bankruptcy order will remain in effect until the debtor is discharged under Section 138 of the IBC. The estate of the bankrupt, excluding assets mentioned in Section 155(2) of the Code read with Rule 5 of the relevant Rules, shall vest with the Bankruptcy Trustee. The trustee is directed to take immediate custody of all assets, properties, and actionable claims and ensure their preservation, protection, security, and maintenance as per Sections 128 and 154.

The bankrupt must submit his statement of financial position to the trustee in the prescribed form within seven days from the order date.

The Registry was directed to provide copies of the bankruptcy order and application to creditors and the trustee within a week per Section 126(2). The trustee must send notices to creditors per Section 130(a) within ten days and issue a public notice in one English and one vernacular newspaper.

Following the bankruptcy order, no actions against the bankrupt's property can be initiated without the leave of the Adjudicating Authority per Section 128. The bankrupt will be subject to disqualifications and restrictions under Sections 140 and 141.

The trustee is empowered to seek further information from the debtor, creditors, or any other person, who must furnish it within seven days. The trustee must exercise all powers under the Code and relevant Rules and Regulations.

The trustee must submit a preliminary report to the Adjudicating Authority within ninety days, with a copy to the bankrupt, per Regulation 8 of the IBBI (Bankruptcy Process for Personal Guarantors to Corporate Debtors) Regulations, 2019. Quarterly progress reports must be submitted within fifteen days after each quarter's end, per Regulation 10.

The trustee's fee will be determined per Regulation 4 of the aforementioned Regulations.

The Registry was directed to email copies of the order to all parties and their counsel.

Topics: Personal Guarantor Bankruptcy, Debt Recovery, Insolvency Process