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2022 (8) TMI 716 - CALCUTTA HIGH COURTRefusal to grant new electricity connection to the petitioners in respect of the factory of the petitioner no.1- Company, unless the alleged outstanding dues left by the erstwhile owner, to the tune of above Rs.3.5 crore, was deposited by the petitioner - HELD THAT:- Regulation 32-A of the Liquidation Process Regulations of 2016 clearly specifies that “liabilities” for the purpose of going concern sales in liquidation are only those liabilities which have been identified and earmarked for the going concern sale by the committee of creditors, if not, by the liquidator - The said provision, read with Regulation 39-C of the Corporate Persons Regulations, 2016, is unambiguous and leaves no scope of construing that all the liabilities, including pre-CIRP liabilities, are transferred to the successful Resolution Applicant in a going concern sale. It is well-settled that the debts of the power distribution licensee do not operate as charge on the assets of the corporate debtor. Both sale of the corporate debtor and the business(es) of the corporate debtor as a going concern, as envisaged in Regulation 32, Clauses (e) and (f) respectively, do not contemplate automatic transfer of all pre-CIRP liabilities of the corporate debtor to the auction purchaser - the Regulations framed under the authority conferred by the IBC cannot be construed to override the provisions of the Code itself. Hence, no interpretation contrary to Section 53 of the IBC which, again, is preceded by a non obstante clause, can be attributed to the expression “going concern sale”, as contemplated in Rule 32 of the Liquidation Process Regulations, 2016. In the present case, the claim of the WBSEDCL of outstanding dues from the petitioners as a pre-condition for grant of electricity cannot be sustained. The WBSEDCL shall give new electricity connection without insisting upon payment of such dues by the petitioners, subject to compliance of all other formalities by the petitioners in connection with their application for new electricity connection at the earliest, latest within a month from compliance of such formalities by the petitioners. Later Judgement: At this juncture after delivery of judgment learned counsel for the respondent-Distribution licensee makes a prayer for stay of operation of the above judgment and order - However, since a month has been given for the WBSEDCL to reconnect electricity, such further stay is deemed unnecessary and hence refused.
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