# In the matter of Jaydip Ghosh & Ors. vs. Niraj Agarwal & Ors.

> NCLAT judgment dated 2023-07-24. Citation: TCN-2023-NCLAT-00349. The case involves two appeals (Company Appeal (AT)(Ins) No.839/2022 and No.861/2022) arising…

- **Court:** NCLAT
- **Order date:** 24 Jul 2023
- **Citation:** TCN-2023-NCLAT-00349
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/jaydip-ghosh-ors-vs-niraj-agarwal-ors-55d68cfc

## Summary

### Background

The case involves two appeals (Company Appeal (AT)(Ins) No.839/2022 and No.861/2022) arising from the same order dated 29.06.2022 passed by the Adjudicating Authority, NCLT, Kolkata Bench. The appeals concern the approval of a resolution plan for Castal Extrusion Pvt Ltd, a corporate debtor. The appellants in No.839/2022 are suspended directors of the corporate debtor, while the appellant in No.861/2022 claims to be a tenant of a major portion of the corporate debtor's land. The resolution plan submitted by Respondent No.2, Square Four Housing and Infrastructure Development Pvt Ltd, was approved, leading to these appeals.

## Facts

Castal Extrusion Pvt Ltd (CEPL) provided a corporate guarantee to Vijaya Bank (now Bank of Baroda) for a loan availed by Tantia Construction Pvt Ltd (TCL) in 2013. CEPL also furnished industrial land as security. In 2014, TCL's account was declared NPA. Harshvardhan Tantia, holding 6.22% shares in CEPL, became a director of T-RMC Pvt Ltd, and CEPL entered into an unregistered lease agreement with T-RMC, creating leasehold rights over a portion of the land. Vijaya Bank issued a notice under SARFAESI Act for enforcement of security interest. In 2018, Vijaya Bank invoked the bank guarantee against CEPL. CEPL entered into another unregistered rent agreement with T-RMC in 2019. Vijaya Bank filed an application under Section 7 of IBC in 2018, which was admitted in 2020,

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## Issues and analysis

### Issue 1: Whether the suspended Board of Directors had the locus standi to file an appeal against the …

**Ratio:** Suspended Board of Directors have no locus to assail approval of the resolution plan

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**Reasoning:** The NCLAT relied on the judgment of the Supreme Court in Innoventive Industries Ltd Vs

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**Interpretation:** The legal principle establishes that after the initiation of CIRP and the

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**Application:** The NCLAT applied this principle to the present case, holding that the

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## Parties

- **Judges:** Rakesh…; Alok Sriv…
- **Appellants:** Jaydip…
- **Respondents:** Castal Extrusion…; Niraj Ag…

## Timeline

- **2013-05-06 — Corporate Gu…**: Castal Extrusion Pvt LTD (CEPL/CD) provided corporate guarantee to the Vijaya Bank (now…
- **2014-03-10 — Account Decla…**: The loan account of TCL was…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 7 — Initiation of corporate insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-7)

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