# In the matter of T-RMC Private Ltd. vs. Niraj Agarwal & Ors.

> NCLAT judgment dated 2023-07-24. Citation: TCN-2023-NCLAT-00348. The case involves an appeal against an order passed by the Adjudicating Authority, NCLT,…

- **Court:** NCLAT
- **Order date:** 24 Jul 2023
- **Citation:** TCN-2023-NCLAT-00348
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/t-rmc-private-ltd-vs-niraj-agarwal-ors-5cddb3f5

## Summary

### Background

The case involves an appeal against an order passed by the Adjudicating Authority, NCLT, Kolkata Bench, concerning IA No.107/KB/2021 in CP(IB) No.438/KB/2018. The Resolution Professional (RP) filed two interlocutory applications seeking eviction of T-RMC Private Limited from the land/premises of the Corporate Debtor (Castal Extrusion Pvt Ltd). The RP argued that the Corporate Debtor had entered into purported tenancy agreements in favor of T-RMC at a grossly undervalued monthly rent to defraud the secured creditors and create third-party interest after the issuance of a notice under SARFAESI. The RP sought to declare the agreement between the Corporate Debtor and T-RMC void and reverse the effect of the transaction, alleging it was an undervalued transaction

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## Facts

Castal Extrusion Pvt. Ltd. (CEPL), the Corporate Debtor, provided a Corporate Guarantee on 06.05.2013 securing the repayment of a loan availed by Tantia Construction Limited (TCL) from Vijaya Bank (now Bank of Baroda). TCL defaulted, leading Vijaya Bank to invoke the Corporate Guarantee. In March 2018, Vijaya Bank filed an application under Section 7 of the IBC against CEPL, which was admitted on 18.03.2020. The RP discovered that CEPL had entered into an unstamped and unregistered Rent Agreement on 26.07.2019 with T-RMC Pvt. Ltd., creating a leasehold interest over 1.90 acres of its land for a monthly rent of Rs.55,000/-. This agreement was preceded by another unstamped and unregistered Rent Agreement dated 27.07.2014, which expired on 26.07.2019. The RP argued that

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## Issues and analysis

### Issue 1: Whether the tenancy agreements between the Corporate Debtor and T-RMC were fraudulent and …

**Ratio:** The principle applied is that transactions designed to defraud creditors and keep assets

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**Reasoning:** The court reasoned that the tenancy agreements were entered into after the Corporate

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**Interpretation:** The interpretation is that any transaction entered into with the intention of

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**Application:** The ratio and reasoning were applied to the facts by considering the timing of

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## Parties

- **Judges:** Rakesh…; Alok Sriv…
- **Appellants:** T-RMC Priva…
- **Respondents:** Castal Extrusion…; Niraj Ag…

## Timeline

- **2013-05-06 — Corporate Gu…**: Castal Extrusion Pvt. Ltd. provided Corporate Guarantee securing repayment of loan…
- **2014-03-10 — Account Decla…**: Tantia Construction…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 5(24) — Definitions](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-5)

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