The National Company Law Tribunal (NCLT) has declared Venugopal Nandlal Dhoot, former promoter of Videocon Industries, bankrupt after admitting a petition filed by the State Bank of India (SBI) seeking recovery of dues exceeding ₹12,668 crore — liabilities arising from personal guarantees he had furnished for loans extended to Videocon Group companies. The ruling marks a decisive turn in one of India's most closely watched corporate insolvency cases.

The Legal Basis for the Order

A Mumbai bench of the tribunal admitted SBI's petition under Section 123 of the Insolvency and Bankruptcy Code (IBC), formally triggering bankruptcy proceedings against Dhoot in his capacity as a personal guarantor. The order follows the breakdown of his personal insolvency resolution process after creditors rejected a repayment plan he had proposed.

The tribunal appointed insolvency professional Asish Narayan as the bankruptcy trustee and directed that Dhoot's estate be vested in him for administration and distribution among creditors. The trustee has been instructed to invite claims from creditors, take control of Dhoot's assets, and submit a preliminary report to the tribunal within 90 days.

The Scale of the Dues

According to SBI, Dhoot's outstanding liabilities stood at ₹12,668.06 crore, inclusive of interest and penalties as of 30 September. The dues are linked to personal guarantees he had provided for term loans, working capital facilities, and borrowings extended to Videocon Group entities, including Videocon Telecommunications Ltd. SBI had invoked those guarantees in February 2018 following loan defaults by the group.

Why the Repayment Plan Failed

During the personal insolvency proceedings, Dhoot had proposed repaying ₹600 crore over three years through a proposed real estate development project in Siliguri. The offer amounted to less than 1 per cent of the admitted claims — a figure creditors and resolution professionals found inadequate.

The resolution professional raised specific concerns: the plan was contingent on future project approvals, carried uncertain cash flows, and provided no upfront payment. Creditors subsequently declined to approve it. The tribunal terminated the insolvency resolution process in July 2026 and permitted creditors to initiate bankruptcy proceedings, after which SBI filed its petition within the prescribed timeline.

Significance for India's IBC Framework

The Dhoot case is among the highest-value personal guarantor proceedings under the IBC since the Supreme Court upheld the constitutional validity of personal guarantor provisions in 2021. It signals that lenders — particularly public sector banks — are willing to pursue individual promoters to their last rupee of personal estate, not merely through corporate resolution. Notably, this comes as Indian courts have reinforced the principle that a corporate resolution plan does not extinguish a guarantor's personal liability.

The outcome of Dhoot's bankruptcy proceedings, including the realisation value from his estate, will be watched closely by creditors across other large insolvency cases involving personal guarantees.