NCLT Mumbai Admits Bank Of Maharashtra's CIRP Plea Against DNR India Autotech Over ₹17.98 Crore Default

The Mumbai Bench of the National Company Law Tribunal (NCLT) has recently admitted Bank of Maharashtra's insolvency plea against DNR India Autotech Pvt Ltd. The Corporate Insolvency Resolution Process has been initiated over an alleged default of ₹17.98 crore arising from a corporate guarantee executed by the company for credit facilities extended to Tirumalla Agro Industries Pvt Ltd.

A bench of Judicial Member Nilesh Sharma and Technical Member Sameer Kakar admitted the petition after holding that the financial creditor had established the existence of a financial debt and a continuing default above the statutory threshold. 

"In view of the above discussion, the Applicant has successfully demonstrated the existence of a financial debt as the transaction involves money borrowed against the payment of interest under Section 5(8)(a) of IBC 2016, the occurrence of default which is way above the threshold as stipulated under Section 4 of the Code (i.e. 1 Crore), and continuing nature of such default supported by clear documentary evidence.", the tribunal ruled.

The application was filed on December 24, 2025. Bank of Maharashtra had sanctioned ₹16 crore in credit facilities to Tirumalla Agro Industries under a consortium arrangement on December 19, 2022 with DNR India Autotech acting as the corporate guarantor.

The principal borrower's account was classified as an NPA on May 13, 2024 following which a SARFAESI demand notice was issued on May 14, 2024. The corporate guarantee was invoked on October 29, 2025 and the date of default was recorded as November 24, 2025.

The Tribunal relied on the Supreme Court's decision in Power Trust (Promoter of Hiranmaye Energy Ltd.) v. Bhuvan Madan reiterating that while considering a Section 7 application, the Adjudicating Authority is only required to ascertain the existence of a default and not examine the corporate debtor's financial viability or other disputes.

The tribunal also observed that the bank had validly invoked the corporate guarantee and the corporate debtor failed to discharge its liability, thereby committing default under the IBC.

Accordingly, the Tribunal admitted the petition, declared a moratorium under Section 14 of the IBC and appointed Mangesh Vitthal Kekre as the Interim Resolution Professional. 

For Applicant: Advocate Prashant Gawali along with Advocates Gaurav Devdhekar Instructed by  Advocate Mahalakshmi Ganapathy

For Respondent: None. (ex-parte)