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TMI Blog2018 (2) TMI 1836X X X X Extracts X X X X X X X X Extracts X X X X ..... s to ‘Essential Supplies’. As per Regulation 31, the amounts due to suppliers of essential goods and services under Regulation 32 are to be included in the ‘Insolvency Resolution Process Costs’. It is clear that the amount as is due towards supply of essential goods and services, including electricity, water, telecommunication services and information technology services, if they are not a direct input to the output produced or supplied by the ‘Corporate Debtor’, require to be included towards ‘Insolvency Resolution Process Costs’ as per sub-section 13(e) of Section 5. From sub-section (2) of Section 14 of the ‘I&B Code’, it is also clear that essential goods or services, including electricity, water, telecommunication services and in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s supply of electricity, water etc. In case the ‘Corporate Debtor’ (Company) is non-functional due to paucity of fund, and has become sick the question of keeping it on going does not arise. In absence of specific prohibition for payment of current charges and in view of the fact that the ‘Corporate Debtor’ has already paid the current electricity charges for the month of December, 2017, we pass the following orders: - (i) The ‘Resolution Professional’ will pay the outstanding current charges for supply of electricity for the month of September, 2017 and January, 2017 to the Appellant by 28th February, 2018. The current electricity charges for the month of October, 2017 and February, 2017 be paid by 16th March, 2018. The current charg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l goods and services, including the electricity, water etc. 4. Earlier, when the matter was taken up, this Appellate Tribunal by order dated 15th January, 2018 without deciding the issue, passed the following order: 15.01.2018- An application has been filed by Resolution Professional requesting to extend the time granted by this Appellate Tribunal on 3rd January, 2018 to pay the current charges to the Appellant upto 31st December, 2017. Prayer has been made to allow further four weeks time to pay the amount, in view of the fact only sum of ₹ 7 lakhs is available in the account whereas ₹ 5 lakhs is payable for the month of December. Learned counsel appearing on behalf of the Appellant submits that the period of morat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... encement date, the Adjudicating Authority shall by order declare moratorium for prohibiting all of the following, namely:- (a) the institution of suits or continuation of pending suits or proceedings against the corporate debtor including execution of any judgment, decree or order in any court of law, tribunal, arbitration panel or other authority; (b) transferring, encumbering, alienating or disposing of by the corporate debtor any of its assets or any legal right or beneficial interest therein; (c) any action to foreclose, recover or enforce any security interest created by the corporate debtor in respect of its property including any action under the Securitisation and Reconstruction of Financial Assets and Enforcement of Securi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ers of essential goods and services under Regulation 32 are to be included in the Insolvency Resolution Process Costs , as quoted below: 31. Insolvency resolution process costs. ─ Insolvency resolution process costs under section 5(13) (e) shall mean─ (a) amounts due to suppliers of essential goods and services under Regulation 32; (b) amounts due to a person whose rights are prejudicially affected on account of the moratorium imposed under section 14(1)(d); (c) expenses incurred on or by the interim resolution professional to the extent ratified under regulation 33; (d) expenses incurred on or by the resolution professional fixed under regulation 34; and (e) other costs directly relating to the corporate i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s payment of current charges of essential services. Such payment is not covered by the order of Moratorium . Regulation 31 cannot override the substantive provisions of Section 14; therefore, if any cost is incurred towards supply of the essential services during the period of Moratorium , it may be accounted towards Insolvency Resolution Process Costs , but law does not stipulate that the suppliers of essential goods including, the electricity or water to be supplied free of cost, till completion of the period of Moratorium . Payment if made towards essential goods to ensure that the Company remains on-going as made in the present case for the month of December, 2017, such amount can be accounted towards Insolvency Resolution Process ..... X X X X Extracts X X X X X X X X Extracts X X X X
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