NCLT Delhi Discharges Mukund Choudhary As CLC Industries Guarantor After ₹7.3 Crore Plan Implementation

The New Delhi Bench of the National Company Law Tribunal (NCLT) on 19 May held that a personal guarantor stands discharged upon full implementation of a repayment plan under the Insolvency and Bankruptcy Code, 2016, and that the Personal Insolvency Resolution Process must close once statutory compliances under the Code are fulfilled.

Judicial Member Mahendra Khandelwal and Technical Member Ms. Anu Jagmohan Singh, allowed an application filed by Resolution Professional Hemant Sharma under Section 119 of the IBC and discharged Mukund Choudhary, personal guarantor to CLC Industries Ltd, while closing the PIRP. The Bench observed:

“While allowing the application, the NCLT observed that the statutory requirements under Sections 117 and 119 of the IBC had been duly complied with, including filing of the implementation report and issuance of notices regarding completion of the repayment plan.”

Mukund Choudhary initiated the personal insolvency resolution process by filing an application under Section 94(1) of the IBC. The Adjudicating Authority appointed a Resolution Professional, who submitted a report under Section 99 of the Code.

Choudhary submitted a repayment plan dated 28 January 2025 under Section 105 of the IBC. Creditors approved the plan in their fifth meeting held on 11 February 2025. The National Company Law Tribunal approved the plan on 3 December 2025 under Section 114 of the Code.

Under the approved plan, Choudhary paid Rs. 7.3 crore for distribution among creditors of CLC Industries Ltd. Resolution Professional Hemant Sharma informed the tribunal that nearly the entire amount stood distributed in accordance with the plan, except Rs. 49,607, which remained undistributed after one creditor returned the demand draft issued towards its entitlement.

The Resolution Professional placed the returned amount in a fixed deposit with Axis Bank for withdrawal by the concerned creditor. Creditors holding 93.59% voting share approved waiver of delay in implementation arising from technical banking issues and the demise of the earlier Resolution Professional.

The Tribunal recorded completion of all distributions under the repayment plan and compliance with statutory requirements under the IBC. It held that the repayment plan stood fully implemented and discharged Mukund Choudhary from all debts and liabilities covered under the approved plan. It clarified that the discharge would not affect any co-obligor or other person liable for the same debt.

Accordingly, the NCLT closed the PIRP and relieved the Resolution Professional from his duties.

For the Applicant: Mr. Milan Singh Negi, Mr. Nikhil Kumar Jha, Ms. Katyayani, Mr. Utkarsh, Advs. for Applicant/RP

For the Respondent: Mr. Lokesh Malik, Adv., for the PG