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TMI Blog2021 (6) TMI 343X X X X Extracts X X X X X X X X Extracts X X X X ..... ectricity to the unit situated at E1 & E5, Chincholi MIDC, Chincholi, Solapur ("said Unit"). The Respondent No. 2 (R2) was appointed as the Resolution Professional of the erstwhile Corporate Debtor, Ambey Iron Pvt. Ltd. 3. This is an Application filed under section 60(5) of the Insolvency and Bankruptcy code, 2016 (hereinafter referred to as "IB Code") read with rule 11 of the National Company Law Tribunal Rules, 2016. Pursuant to the Order dated October 14, 2019 passed by this Tribunal approving the Resolution Plan of the Applicant, the Applicant approached the Respondent No. 1 for a new electricity connection at the said Unit. However, the Respondent No. 1, for the first time, on January 24, 2020 informed the Applicant that the erstwhile Corporate Debtor has arrears amounting to Rs. 2,16,847/- (Rupees Two Lakhs Sixteen Thousand Eight Hundred Forty Seven Only) on account of Additional Energy Charges ("AEC") which were made applicable from the month of August, 2013 till January 2014 pursuant to a certain Order passed by the Maharashtra State Electricity Regulatory Commission in November 2017, i.e. prior to the initiation of CIRP. At that time, the Applicant brought to the attentio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lodged, considered and accepted during the Corporate Insolvency Resolution Process are already made part of the Resolution Plan, therefore, subsequent to the approval of the Resolution Plan by the CoC, no such claim can be added in the proposed Resolution Plan presently under discussion. 8. The electricity connection at the said Unit was disconnected on December 31, 2014 on account of non-payment of electricity dues. As a result, the office of the R1 deducted a total amount of Rs. 29,78,500/- (Rupees Twenty-Nine Lakhs Seventy-Eight Thousand Five Hundred Only) from the security deposit of Rs. 1,08,14,570/- (Rupees One Crore Eight Lakhs Fourteen Thousand Five Hundred Seventy Only) and the balance amount was refunded to Ambey Iron Pvt. Ltd. Pursuant to the same, the office of the R1 also issued a No Dues Certificate on March 11, 2015. 9. Notwithstanding the issuance of 'No Dues Certificate' dated 11.03.2015, it is submitted that the R1 maliciously raised arrears to the tune of Rs. 2,16,847/- to the Applicant, whereas the monies were otherwise recoverable from the Corporate Debtor. The R1 never raised any claim before the R2 towards the recovery of any arrears. 10. However, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be paid, it leaves no room for doubt that no creditor can later on make claims or demand any sum pertaining to a period prior to passing of resolution plan." 14. A similar Order dated 26.11.2020 was passed by the Hon'ble Bombay High Court in the matter of GGS Infrastructure Pvt. Ltd. vs. Commissioner of CGST and Central Excise (WP-LD-VC-No. 268 OF 2020) in terms of Income Tax dues arising pursuant to passing of the Resolution Plan. By way of the said Order dated 26.11.2020, the Hon'ble Bombay High Court observed that 31. From a conjoint reading of section 31(1) and section 238 of the Code, it is quite evident that the provisions of the Code shall have overriding effect. The non obstante clause in section 238 and the use of the expression "shall" in sub-section (1) of section 31 makes it abundantly clear that a resolution plan approved by the committee of creditors and further approved (or sanctioned) by the adjudicating authority would be binding on all creditors including the Central Government, any State Government or any local authority to whom a debt in respect of the payment of dues arising under any law for the time being in force, such as authorities to whom s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rate Debtor was disconnected, MSEDCL had refunded balance amount of security deposit after deducting the outstanding bill amount to the Corporate Debtor and also gave No due certificate to the corporate Debtor dated 11th March, 2015. 20. Since, connection at the premises of Corporate Debtor was disconnected prior to the clarificatory order of MERC, therefore, MSEDCL debited the account of Corporate Debtor for Rs. 2,16,847/- in the consumer personal ledger of the Corporate Debtor. Resolution plan of the Corporate Debtor was approved by the Committee of Creditors and accordingly by the NCLT on 14th October, 2019. Sometime in January, 2021 officer of Resolution Applicant visited the office of MSEDCL for electricity connection at the premises of Corporate Debtor and for the first time MSEDCL came to know about initiation of CIRP process of the Corporate Debtor and Resolution plan being approved by NCLT. Immediately, MSEDCL vide its letter dated 24th January, 2020 (Exhibit E to IA 1444 of 2020) informed the Corporate Debtor that amount of Rs. 2,16,849/- are arrears towards electricity dues and requested the Corporate Debtor to make payment of the same. 21. Corporate Debtor vide its le ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Regulation 10.5: "Any charge for electricity or any sum other than a charge for electricity due to the Distribution Licensee which remains unpaid by a deceased consumer or the erstwhile owner/occupier of any premises, as a case may be, shall be a charge on the premises transmitted to the legal representatives/successors-in-law or transferred to the new owner/occupier of the premises, as the case may be, and the same shall be recoverable by the Distribution Licensee as due from such legal representatives or successors-in-law or new owner/occupier of the premises, as the case may be;....." 23. Maharashtra Electricity Regulatory Commission (Electricity Supply Code and other Conditions of Supply) Regulations 2005 have a statutory character and provides that unpaid electricity dues or charge of the Distribution Licensee constitutes a charge on the premises of the erstwhile owner! occupier of premises and that such charge on the premises shall be transmitted to the legal representatives! successors in law of the premises. Therefore, MSEDCL being the Distribution Licensee is at liberty to recover arrears of the erstwhile consumer from its successor in law/legal representatives i.e. Re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the date of sale/lease and for indemnity in the event they are made liable. Be that as it may. 12. In this case, when the first respondent, who was the purchaser of a sub-divided plot, wanted a new electricity connection for its premises, the appellant informed the first respondent that such connection will be provided only if the electricity dues are paid pro rata. They were justified in making the demand." 26. Further, where the statutory rules or terms and conditions of supply which are statutory in character authorizes the licensee to demand from the consumer claiming reconnection or fresh electricity connection, the arrears amount is due by the previous owner/occupier in regard to supply of electricity to such premises the licensee can recover the arrears so long as such Rules and Regulations or the terms and conditions are not arbitrary and unreasonable. 27. Respondent has lakhs of consumers in the State of Maharashtra and with frequent moving or translocating of industrial, commercial and residential consumers, if such a stipulation for recovery of outstanding arrears is not provided then it will be extremely difficult for the Respondent to recover the outstanding ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of equity and justice, Application taken out by the Applicant be dismissed. 30. In the view of factual matrix of present case the position in law is settled by Hon'ble Apex Court in the matter of Committee of Creditors of Essar Steel India Limited vs. Satish Kumar Gupta & Ors. (CIVIL APPEAL No. 8766-67 OF 2019) para 15 supra. Therefore, there is no room for doubt that no creditor can later on make claims or demand any sum pertaining to a period prior to passing of resolution plan. 31. The Applicant has successfully taken over the assets and operations of the Corporate Debtor by effectively complying with the Resolution Plan. Thus, only the name of the Corporate Debtor is retained and whereas the management of the Corporate Debtor is not at all related to the erstwhile management. Therefore, as soon as the Order approving the Resolution Plan was passed by this Tribunal, and the Plan was put into effect, Section 32A of the Code is attracted. Therefore, R1 is barred from raising any arrears against the Corporate Debtor/Applicant at this juncture. Section 32A also puts responsibility on the Corporate Debtor and bona fide purchaser to cooperate in investigation. In Paragraphs 279 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... overlook the principle that the impugned provision is part of an economic measure. The reverence courts justifiably hold such laws in cannot but be applicable in the instant case as well. The provision deals with reference to offences committed prior to the commencement of the CIRP. With the admission of the application the management of the corporate debtor passes into the hands of the Interim Resolution Professional and thereafter into the hands of the Resolution Professional subject undoubtedly to the control by the Committee of Creditors. As far as protection afforded to the property is concerned there is clearly a rationale behind it. Having regard to the object of the statute we hardly see any manifest arbitrariness in the provision." Thus constitutional validity of Section 32A has been upheld. 32. In view of the above and taking into consideration the intent of the insertion of Section 32A, the submission of R1 is against the principles of Section 32A of the Insolvency and Bankruptcy Code, 2016. 33. Therefore, we direct the R1 to credit an amount of Rs. 2,17,000/- (Rupees Two Lakhs Seventeen Thousand Only) which was paid under protest by the Applicant, into the Bank Accou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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