Authority: National Company Law Tribunal Chandigarh Bench (Court-I)
Order Date: 10.07.2026
Case Overview
The petition was filed by Naman under Section 95 of the Insolvency and Bankruptcy Code, 2016, read with the relevant 2019 Rules, seeking to initiate an insolvency resolution process against Suresh Pal in his capacity as the personal guarantor for the corporate debtor, Sargun Power Private Limited. The petitioner, a supplier of charcoal to the corporate debtor, claimed that a Guarantee Deed was executed by the respondent on 03.11.2022 to secure payment obligations. The amount in default was stated to be ₹8,51,520 as of 02.03.2025. The principal issue for determination was the maintainability of the application, given that the admitted default amount was below the ₹1 crore threshold specified in Notification No. S.O. 1205(E) dated 24.03.2020, issued under the proviso to Section 4 of the Code. The petitioner contended that this enhanced threshold applied only to corporate insolvency under Part II of the Code and not to proceedings against personal guarantors under Part III, for which the threshold remained ₹1,000 as per Section 78.
The tribunal analyzed the notification and relevant case law, including the NCLAT decision in Mudraksh Investfin Pvt. Ltd. v. Gursev Singh (2025), which had authoritatively settled the issue. The NCLAT had held that for an application against a personal guarantor to be filed before the NCLT, the threshold is ₹1 crore, and the ₹1,000 threshold under Section 78 applies only to applications filed before the Debt Recovery Tribunal for other individuals or partnership firms.
Final Outcome
The tribunal dismissed the petition (CP(IB) No. 261/Chd/Hry/2025) in limine, holding that it was not maintainable as the default amount of ₹8,51,520 was substantially below the statutory threshold of ₹1 crore required for proceedings under Section 95.
Topics: Insolvency Threshold, Personal Guarantor, NCLT Jurisdiction