Authority: National Company Law Tribunal (NCLT), Ahmedabad Bench - II (Coram: Mrs. Chitra Hankare, Member (Judicial) & Dr. Velamur G Venkata Chalapathy, Member (Technical))

Order Date: 10/06/2026

Case Overview

This Interlocutory Application (IA No. 721 of 2026) was filed by Mr. Ajay Radheshyam Goenka, a Personal Guarantor (PG) to the Corporate Debtor, M/s Rainbow Papers Ltd., under Section 60(5) of the Insolvency and Bankruptcy Code (IBC), 2016 read with Rule 11 of the NCLT Rules, 2016. The application was against Mr. Ramchandra Dallaram Choudhary (Resolution Professional of the PG) and Uttar Gujarat Vij Company Limited (UGVCL).

The Applicant/PG sought to: (a) declare an ex-parte decree dated 05.01.2023 from the Principal Senior Civil Judge, Kalol, as void ab initio for violating the moratorium under Section 14(1)(a) of the IBC; (b) quash all legal actions taken by UGVCL for violating Sections 96 and 101 of the IBC; (c) quash UGVCL's participation in his Personal Insolvency Resolution Process (PIRP); and (d) remove UGVCL from the array of parties in IA No. 1287 of 2025.

The principal dispute centered on whether UGVCL, an electricity distributor, could be considered a creditor and participate in the PG's insolvency process. The Applicant argued that no deed of personal guarantee was ever executed in favour of UGVCL. He contended that UGVCL's suit for recovery of electricity dues (₹1,13,13,583 with 9% interest) was filed as Special Civil Suit No. 48 of 2017 after the Corporate Insolvency Resolution Process (CIRP) of Rainbow Papers Ltd. had commenced on 12.09.2017, violating the Section 14 moratorium. This suit was later converted into Commercial Civil Suit No. 32 of 2022, which resulted in an ex-parte decree on 05.01.2023.

Furthermore, the Applicant stated that after his PIRP was initiated on 15.05.2024 (admitted on 04.06.2025), an interim moratorium under Section 96 came into effect. Despite this, UGVCL filed Commercial Execution Petition No. 08 of 2024. The Applicant's appeal against the ex-parte decree to the Gujarat High Court was dismissed on 06.03.2025. The Applicant also argued that UGVCL's claim in the PIRP had been rejected by the Resolution Professional and that all unclaimed dues from the corporate CIRP (where a resolution plan was approved on 27.02.2019) stood extinguished.

The Tribunal observed that the application was not maintainable. It noted that the Applicant had already filed a petition before the Gujarat High Court to set aside the same ex-parte decree, which was dismissed on merit. Therefore, no cause of action survived to file it again before the NCLT. The Tribunal also stated that the NCLT lacked jurisdiction to set aside a civil court decree at this stage. It was further noted that IA No. 1287 of 2025, in which UGVCL was impleaded, had already been disposed of on 06.05.2026, making the related prayer infructuous.

Final Outcome

The application (IA No. 721 of 2026 in IA No. 1287 of 2025 in CP(IB) 207 of 2024) was rejected and disposed of. UGVCL remains a participant in the process, and the civil court decree against the Applicant stands.

Topics: Personal Guarantor Insolvency, Moratorium Violation Challenge