2023 (8) TMI 484 - AT - Insolvency and Bankruptcy

Recovery of electricity dues - Resolution plan already approved (Appellant did not file any claim in the Insolvency Resolution Process of the Corporate Debtor) - HELD THAT - The submission of the Appellant that there was no proper publication of the announcement made by the Resolution Professional has been dealt by the Adjudicating Authority. The Adjudicating Authority has noted the provisions of Regulation and has returned a finding that on the above submission of the Appellant plan approval cannot be held to be vitiated. It is also to be noted that against the plan approval order, Appellant filed an Appeal which was withdrawn by the Appellant themselves. No contention by the Appellant challenging the plan approval can be considered. The Adjudicating Authority while approving the Plan having already issued directions that Electricity Distribution Companies shall not raise any demand with reference to the past dues, there are no error in the direction issued by the Adjudicating Authority by the Impugned Order directing the Appellant to consider the service connection application of the Applicant in accordance with the Code/Regulation without insisting on making any payment of arrears prior to date of plan approval. No grounds have been made out to interfere with the Impugned Order passed by the Adjudicating Authority. Appeal dismissed.

Summary

Issues involved:
The issues involved in the judgment are:
1. Validity of the demand for outstanding electricity dues.
2. Entitlement for service connection.

Issue 1: Validity of the demand for outstanding electricity dues:
The appeal was filed against the Order passed by the National Company Law Tribunal initiating Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor. The Resolution Plan submitted by a company was approved by the Adjudicating Authority. The Appellant was informed about the approval of the Resolution Plan. The Respondent requested electricity supply from the Appellant, who informed about outstanding arrears of electricity dues. The Adjudicating Authority declared the amount claimed by the Respondents as not valid against the Corporate Debtor. The Appellant challenged this decision in the Appeal.

Issue 2: Entitlement for service connection:
The Adjudicating Authority noted that the Resolution Plan had been approved, and the claim of the Appellant against the Successful Resolution Applicant of arrears was not valid. The Authority directed the Respondent to consider the service connection application of the Applicant without insisting on payment of arrears prior to the date of plan approval. The Appellant argued that electricity dues needed to be paid before providing the service connection, citing termination of power supply agreements and outstanding arrears. The Respondent contended that the pre-CIRP dues of the Appellant had been extinguished as it did not file any claim. The Adjudicating Authority relied on a Supreme Court judgment and upheld its decision, stating that no error was made in directing the service connection without payment of past dues.

The Adjudicating Authority found no merit in the Appeal and dismissed it, as no grounds were presented to interfere with the Impugned Order.