2023 (9) TMI 1071 - SCH - Insolvency and Bankruptcy

Recovery of Electricity dues - waterfall mechanism - successful resolution applicant is asked to pay the arrears payable by the corporate debtor for the grant of an electricity connection in her/his name - HELD THAT - The observations from Embassy Property Developments Private Limited 2019 (12) TMI 188 - SUPREME COURT would confer jurisdiction on the tribunal constituted under the Code insofar as the appellant Tata Power Western Odisha Distribution Limited is insisting on payment of the dues of the corporate debtor for restoration/grant of the electricity connection. The dues of the corporate debtor have to be paid in the manner prescribed in the resolution plan, as approved by the adjudicating authority. The resolution plan is approved when it is in accord with the provision of the Code. Thus, the issue of corporate debtor s dues falls within the fold of the phrase arising out of or in relation to insolvency resolution under section 60(5)(c) of the Code. There are no good ground and reason to interfere with the impugned judgment(s)/order(s) - the present appeals are dismissed.

Summary

Issues involved:
The legal issue regarding payment of arrears for grant of electricity connection, jurisdiction of tribunal in relation to corporate debtor's dues.

Payment of Arrears for Electricity Connection:
The appellant, Tata Power Western Odisha Distribution Limited, cannot demand payment of arrears to grant an electricity connection, as per the precedent set in previous judgments. The successful resolution applicant must comply with other requirements for the connection, but insisting on arrears payment would negate the clean slate principle.

Jurisdiction of Tribunal in Corporate Debtor's Dues:
Referring to the case of Embassy Property Developments Private Limited vs. State of Karnataka, the tribunal under the Code has jurisdiction when the issue relates to dues payable to an operational or financial creditor. The tribunal's authority extends to cases where the government is an operational creditor, and the dues of the corporate debtor must be paid as per the resolution plan approved by the adjudicating authority. The tribunal's jurisdiction covers matters arising in relation to insolvency resolution under section 60(5)(c) of the Code.

Judgment:
The Supreme Court found no valid reason to interfere with the impugned judgment and orders, leading to the dismissal of the present appeals. Any pending applications are deemed disposed of as a result.