# In the matter of Castal Extrusion Private Limited IA (IB) No.107-KB-2021, I.A. (IB) No.1302-KB-2020, I.A.(IB)429-KB-2022 in CP (IB) No. 438-KB-2018

> Read the full IBC case summary for In the matter of Castal Extrusion Private Limited IA (IB) No.107-KB-2021, I.A. (IB) No.1302-KB-2020, I.A.(IB)429-KB-2022 in…

- **Court:** NCLT
- **Order date:** 29 Jun 2022
- **Citation:** TCN-2022-NCLT-04631
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/castal-extrusion-private-limited-ia-ib-no107-kb-2021-ia-ib-no1302-kb-2020-iaib42-89e60515

## Summary

### Background

The Resolution Professional filed two interlocutory applications seeking to declare a rent agreement between the Corporate Debtor and T-RMC Private Limited as void and to reverse its effect, alleging it was an undervalued transaction intended to defraud creditors. The RP also sought eviction of T-RMC from the Corporate Debtor's land and recovery of benefits received by T-RMC.

## Facts

The underlying company petition, CP (IB) No. 438/KB/2018, was filed by Vijaya Bank against Castal Extrusion Private Limited (Corporate Debtor) under section 7 of the Insolvency and Bankruptcy Code, 2016. The application was admitted on March 18, 2020, initiating the Corporate Insolvency Resolution Process (CIRP). Mr. Niraj Agrawal was appointed as the Interim Resolution Professional (IRP) and later confirmed as the Resolution Professional (RP) at the first Committee of Creditors (CoC) meeting on August 18, 2020, which concluded on August 19, 2020.

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## Issues and analysis

### Issue 1: Whether the agreement dated July 26, 2019, between the Corporate Debtor and T-RMC Private Limited…

**Ratio:** An agreement entered into by a corporate debtor with a related party at an undervalue,…

**Reasoning:** The court considered the Transaction Audit Report which found the rent agreement to be an…

**Interpretation:** The court interpreted Sections 45 and 49 of the IBC to allow for the reversal…

**Application:** The court applied this interpretation to the facts, concluding that the rent…

## Parties

- **Judges:** Rohit K…; Harish Chander…
- **Advocates:** For…; Joy Saha, S…; +10 more

## Timeline

- **March 10, 2014 — NPA Declaration and…**: The principal borrower TCL's account with Vijaya Bank was declared as Non-Performing…
- **July 27, 2014 — Purported Tenancy…**: A purported unstamped and unregistered Rent Agreement was entered into between the…

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