NCLT Delhi admits Mahamaya Exports into insolvency on Indian Bank plea

The New Delhi bench of the National Company Law Tribunal (NCLT) on 16 October 2026 admitted Mahamaya Exports Private Limited into the corporate insolvency resolution process on a petition by Indian Bank. The bank's case rests on corporate guarantees that Mahamaya gave for loans to ABW Infrastructure Limited, with Rs 21,99,97,847 claimed as principal outstanding on two term loans.

What Happened

According to the order, Indian Bank (formerly Allahabad Bank) lent to ABW Infrastructure between 2010 and 2014, and Mahamaya Exports guaranteed those facilities. The borrower was classified as a non-performing asset on 29 September 2016, and the bank issued a demand notice in October 2016. ABW Infrastructure itself was admitted into insolvency in September 2019.

The bank originally claimed Rs 31,37,63,847, but later reduced its claim to Rs 22,19,97,847 after removing expired bank guarantees. Mahamaya argued that it never received any money, that the bank was already claiming in the borrower's insolvency, and that the petition was filed too late.

The tribunal held that a guarantee for a loan is a financial debt even if the guarantor received no money, and that a lender need not first exhaust its claims against the borrower. It held that the petition, filed on 26 February 2020, was within the time limit because the borrower acknowledged its liability in a letter dated 27 February 2017. Any amount the bank recovers in the borrower's insolvency must be credited, to prevent double recovery. The tribunal rejected Mahamaya's request for costs against the bank.

The NCLT appointed an interim resolution professional, ordered a public announcement within three days, and declared a moratorium under Section 14 of the Insolvency and Bankruptcy Code, which bars suits, recovery actions and the sale of the company's assets during the process.

What It Means

The order shows that companies that guarantee another firm's bank loans can themselves be taken into insolvency if the borrower defaults, according to the tribunal's reasoning. Admission is not a finding of fraud or mismanagement.

Creditors of Mahamaya Exports should watch for the interim resolution professional's public announcement on how and by when to file claims. The NCLT's order may be appealed to the National Company Law Appellate Tribunal (NCLAT).

Source: NCLT order