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TMI Blog2022 (5) TMI 208X X X X Extracts X X X X X X X X Extracts X X X X ..... details, are: 3. The DVC, upon prior notice, disconnected the electricity supply to the factory premises of the petitioner no. 1-company on June 7, 2019. 4. On October 18, 2019, the petitioner no. 1 was admitted to a Corporate Insolvency Resolution Process (CIRP). On April 8, 2021, the Committee of Creditors approved the Resolution Plan. The NCLT approved the same on October 8, 2021. 5. Thereafter the Resolution Professional wrote to the DVC tendering payment of Rs. 7,45,608/- as per the approved Resolution Plan and requested reconnection of electricity, which request was reiterated by a later communication by the petitioner no. 1. 6. However, the DVC, by its letter dated November 25, 2021, demanded payment of Rs. 31,77,33,915/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Nigam Ltd. V. Raman Ispat Pvt. Ltd. &Ors. [2019 SCC OnLine NCLAT 883]. 9. For effective revival of the debtor company, the Resolution Plan is binding with immediate effect from its approval by the NCLT on October 8, 2021, it is argued. Moreover, Section 43 of the Electricity Act, 2003 mandates the DVC to restore supply of power, since the claims of the DVC stand extinguished in law. 10. Moreover, it is contended by the petitioners, the DVC has accepted the amount of Rs. 7,45,608/- tendered by the petitioners and is now estopped from claiming its pre-CIRP dues as a pre-condition for restoring electricity supply. 11. The learned Senior Advocate appearing for the petitioners contends that although an appeal against the order approving the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the ground of insolvency, by operation of Clause 4.6.1. of the West Bengal Electricity Regulatory Commission (Electricity Supply Code) Regulations, 2007, read with Clause 23 of the said agreement. 16. Even as per Essar Steel (supra), relied on by the petitioners, it is argued that the Supreme Court treated electricity dues as distinct and separate from dues of other operational creditors, for which the former has primacy over the Resolution Plan. 17. The learned Senior Advocate for the DVC next relies on Gujarat Urja Vikas Nigam's Case, reported at (2021) 7 SCC 209. The Supreme Court held there that the power purchase agreement was terminated solely on the ground of insolvency, since the event of default contemplated under Article 9.2.1( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ribunal embodied in Section 60(5) of the IBC can be used to oust all powers vested in regular Courts and Tribunals. However, in the present case the issue is not whether the termination of electricity was relatable to the CIRP, but whether the claim of dues of the DVC still survives or has been extinguished and, if so extinguished, whether DVC has a mandatory obligation to supply electricity in terms of Section 43 of the 2003 Act. 24. Upon hearing the contesting parties, this court decides as follows: 25. Gujarat Urja (supra) was on a different footing, inasmuch as the context was the termination of a power purchase agreement in exercise of the powers of the Tribunal under Section 60(5) of the IBC, whereas, in the present case, the german ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nnection of electricity till repayment of such dues. Thus, both the said rights are dependent on the single touchstone - "dues", which relate to electricity and other charges due from the consumer at the time of disconnection. Admittedly, in the present case, disconnection took place prior to commencement of the CIRP; hence, the dues are pre-CIRP debts. 31. Section 56 further provides that the electricity supply may be discontinued "until such charge or other sum, together with any expenses incurred by him in cutting off and reconnecting the supply, are paid" but no longer. The expression "such charge" refers to the first part of the section which relates the charge to the time of disconnection. Insofar as the electricity charges and disco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ving the Resolution Plan is concerned, it is well-settled that mere pendency of an appeal does not operate of its own as a stay. In the absence of any specific stay order being passed in the appeal, there is no impediment to the petitioners asserting their right of immediate resumption of business in terms of the approved Resolution Plan. 36. The so-called undertaking before the NCLAT was a mere submission that no contempt proceeding shall be initiated against the DVC. It is well-known that the contempt jurisdiction is penal in nature and is distinct and different from execution or implementation of an order. Even without initiating any contempt proceeding, the petitioners are fully at liberty to seek implementation of the validly approved ..... X X X X Extracts X X X X X X X X Extracts X X X X
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