# In the matter of Reliance Communications Limited

> NCLT judgment dated 2024-07-24. Citation: TCN-2024-NCLT-00957. The case involves an application (IA 1269 of 2020) filed in Company Petition CP No. 1387 of…

- **Court:** NCLT
- **Order date:** 24 Jul 2024
- **Citation:** TCN-2024-NCLT-00957
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/reliance-communications-limited-a946319f

## Summary

### Background

The case involves an application (IA 1269 of 2020) filed in Company Petition CP No. 1387 of 2017 by the Resolution Professional of Reliance Communications Limited, seeking to declare certain repayments made to RPL Aditya Power Limited as preferential transactions under Section 43 of the Insolvency and Bankruptcy Code, 2016. The Resolution Professional contends that prior to the commencement of the corporate insolvency resolution process (CIRP), Reliance Communications Limited repaid an unsecured loan of Rs. 15.21 crores to RPL Aditya Power Limited. The applicant argues that these payments constitute a preferential transaction that should be set aside.

## Facts

Reliance Communications Limited (the Corporate Debtor) underwent a corporate insolvency resolution process (CIRP). Prior to the commencement of CIRP, the Corporate Debtor repaid an unsecured loan of Rs. 15.21 crores to RPL Aditya Power Limited (the Respondent) in multiple tranches between May 15, 2017, and September 19, 2017. The loan was part of a larger unsecured loan of Rs. 363 crores availed by the Corporate Debtor from the Respondent on April 10, 2017, at an interest rate of 13%. The Resolution Professional of Reliance Communications Limited filed an application arguing that these repayments constituted a preferential transaction under Section 43 of the Insolvency and Bankruptcy Code, 2016, as they were made in priority to secured lenders and put the Respondent in

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## Issues and analysis

### Issue 1: Whether the repayments made by Reliance Communications Limited to RPL Aditya Power Limited …

**Ratio:** Section 43 of the IBC defines preferential transactions as those where a corporate debtor

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**Reasoning:** The court considered whether the repayments were made towards an antecedent debt and

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**Interpretation:** The interpretation of Section 43 focuses on whether the transaction unfairly

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**Application:** The court found that the repayments were made towards an antecedent debt and

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## Parties

- **Judges:** Prabhat…; V.G. B…
- **Appellants:** Anish Niranjan…
- **Respondents:** Reliance Communica…; RPL Aditya Power…

## Timeline

- **2017-04-10 — Loan Agre…**: Corporate Debtor availed an unsecured loan of Rs. 363 crores from the Respondent at an…
- **2017-05-15 — Repayment Tranc…**: Corporate Debtor began repaying the unsecured…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 43 — Preferential transactions and relevant time](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-43)

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