NCLT admits guarantor Sevantilal Fakirchand into insolvency over Rs 1,376 crore debt

The Mumbai Bench-I of the National Company Law Tribunal (NCLT) on 27 October 2026 admitted Sevantilal Fakirchand and Company Private Limited into the corporate insolvency resolution process (CIRP), the process under the Insolvency and Bankruptcy Code (IBC) in which creditors try to rescue a company or recover their dues. The company itself applied, under Section 10 of the IBC, and stated its total debt in default at Rs 13,76,00,96,154.65, about Rs 1,376 crore.

What Happened

According to the order, almost all of that debt arises from corporate guarantees the company gave for loans taken by Antrix Diamond Exports Private Limited from a consortium of lenders led by Bank of India. The order records that the borrower defaulted, its account was classified as a non-performing asset on 7 January 2016, and it was later ordered to be liquidated. The guarantee liability continued.

Bank of India issued a fresh demand notice on 30 July 2026, which put the consortium's outstanding dues at about Rs 1,373.43 crore including interest, the order notes. The rest of the stated debt is about Rs 1.63 crore owed to a related-party lender and about Rs 95.56 lakh to operational creditors such as suppliers. The company reported no revenue from operations in each of the last three financial years.

The tribunal held that the application was complete and that a default above the legal minimum was established. It appointed an interim resolution professional to run the company, ordered a public announcement of the process, and directed the company to pay Rs 1.5 lakh towards that professional's fees up to the first meeting of the committee of creditors. The suspended board undertook to bear the costs of the process.

What It Means

A moratorium now applies under Section 14 of the IBC: no suits, recovery action or enforcement of security, including action under the SARFAESI Act, can proceed against the company while the process runs. Creditors, including the consortium banks, will file claims with the interim resolution professional after the public announcement.

Admission into insolvency is not a finding of fraud or mismanagement. The NCLT's order may be appealed to the National Company Law Appellate Tribunal (NCLAT).

Source: NCLT order