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TMI Blog2024 (6) TMI 308X X X X Extracts X X X X X X X X Extracts X X X X ..... ther authorities to whom statutory dues are owed, they shall be bound by the said resolution. It is seen in the instant case that in accordance with the provisions of the I B Code, public announcements had been made inviting all creditors of the petitioner No. 1, to submit proof of claims on or before 01.06.2016, and the same was also published by the Interim Resolution Professional as evidenced by Annexures 3 to 5 of the writ petition - The approval order then on the resolution coming to a close, was passed on 03.12.2020 by the NCLT, wherein as per the approved Resolution Plan the claims, demands and liabilities as the case may be were to stand fulfilled on the deposit of the resolution amount. Though against the approval order, appeals were filed by various persons, the NCLT on an application by the petitioner No. 1 allowed the deposit of the total value of the Restoration Plan into an Escrow account, which would go towards distribution of the said amount to the creditors, which enabled the acquisition and control of the petitioner No. 1 on a clean slate, as also on all the claims which were lying before the effective date i.e. 22.12.2022. Maintainability of petition - availabili ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2.2022, i.e. the effective date of takeover. Learned counsel submits that the legal issues raised in the instant case are no longer res integra, in view of the judgment rendered by the Supreme Court, in the case of Tata Power Western Odisha Distribution Ltd. (TPWODL) Anr. vs. Jagannath Sponge Pvt. Ltd., wherein it was held that a power distribution company, cannot insist on payment of arrears which would negate the clean slate principle, if the successful resolution applicant is asked to pay the arrears payable by the corporate debtor. It is also submitted that by this decision, the Supreme Court has clarified that in the event any statutory authorities, or creditors have any claim, such person may approach the NCLT, but that in the instant case the respondents are seeking to recover the dues, without approaching the NCLT. 4. The learned counsel submits that the admitted position is that on the resolution plan being approved, the successful resolution applicant had taken over the petitioner No. 1 on 22.12.2022, which is the effective date, which also has been recorded in the order of the NCLT Mumbai dated 11.05.2023. As such, he submits in view of the approved resolution plan, whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... part of the respondents in not providing electricity connections, which is interfering with their rights to carry on trade and business, and also for not acting in terms of the approved resolution. The plea that the respondents have not participated in the resolution process, he submits cannot now be taken as a pretext to take coercive measures against the petitioners as has been done. On the question of alternative remedy, the learned counsel submits that writ jurisdiction is being invoked, as the writ petitioners are seeking the enforcement of their fundamental rights as the actions of the respondents is wholly arbitrary and without jurisdiction. 7. In reply to the submissions made by the counsel for the petitioners, the learned Advocate General appearing for the respondents has raised the following grounds: First, that a resolution plan that ignores statutory dues is invalid and not binding, secondly, the resolution plan does not provide for waiver of statutory dues, thirdly, electricity dues are statutory in nature and the liability does not cease and fourthly, that the writ petition is not maintainable due to the presence of effective alternative remedy, and is based on the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n contended that the writ petition is not maintainable for implementation of the resolution plan, as the petitioners have alternate remedy by virtue by Section 60 (5) (c) of the Insolvency and Bankruptcy Code, 2016 and that further Section 63 thereof, provides that no civil court or authority, shall have jurisdiction to entertain any suits or proceedings in respect of any matter, in which the NCLT or NCLAT has jurisdiction under the said Code. In support of this contention, the learned AG has cited the following decisions: - i) Thansingh vs. Superintendent of Tax, Dhubri, AIR 1964 SC 1419 ii) City and Industrial Development Corpn. Vs. Dosu Aardeshir Bhiwandiwala 11. Arguments have also been advanced that the writ is not maintainable as there exists disputed question of facts, inasmuch as, the orders under challenge are against proforma respondents Nos. 3 4. It is submitted that the petitioner has sought quashing of the recovery notice to proforma respondents Nos. 3 4, and that these respondents themselves, have not approached this Court to assail the same, meaning thereby that they are not aggrieved, which would make the instant petition on behalf of the respondents No. 3 4, not ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ory dues are owed,] guarantors and other stakeholders involved in the resolution plan: Provided that the Adjudicating Authority shall, before passing an order for approval of resolution plan under this sub-section, satisfy that the resolution plan has provisions for its effective implementation. 14. As such, by operation of the above quoted provision, even in cases where the creditors include Central Government and such other authorities to whom statutory dues are owed, they shall be bound by the said resolution. It is seen in the instant case that in accordance with the provisions of the I B Code, public announcements had been made inviting all creditors of the petitioner No. 1, to submit proof of claims on or before 01.06.2016, and the same was also published by the Interim Resolution Professional as evidenced by Annexures 3 to 5 of the writ petition. Thereafter, what is more telling, is that by a letter dated 25.07.2019, (Annexure 6 to the writ petition) the Resolution Professional, had addressed a letter to all the State Electricity Boards informing them of the Corporate Insolvency Resolution Process (CIRP) and further, had invited any claims which had not yet been submitted ag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... process and as such, as per Section 31 is bound by the same. The dues claimed by the respondent No. 1, are for the periods prior to the effective date i.e. 22.12.2022, which on the approval of the Resolution Plan, on no claim being made by the respondent No. 2, would therefore stand extinguished. In the considered view of this Court, Section 56 of the Electricity Act will not be attracted, as it is not a case where the petitioner No. 1, after the effective date, has neglected to pay any charge of electricity, or that any amount is due. For easy reference Section 56 of the Electricity Act, 2003 is reproduced hereinbelow:- 56. Disconnection of supply in default of payment: -- (1) Where any person neglects to pay any charge for electricity or any sum other than a charge for electricity due from him to a licensee or the generating company in respect of supply, transmission or distribution or wheeling of electricity to him, the licensee or the generating company may, after giving not less than fifteen clear days notice in writing, to such person and without prejudice to his rights to recover such charge or other sum by suit, cut off the supply of electricity and for that purpose cut or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such claims, which are not a part of resolution plan, shall stand extinguished and no person will be entitled to initiate or continue any proceedings in respect to a claim, which is not part of the resolution plan. 18. Further, the above proposition that is applicable to the instant case, has also been dealt with in the case of Southern Power Distribution Company of Andhra Pradesh Limited vs. Gavi Siddeswara Steels (India) Pvt. Ltd. Anr. and Tata Power Western Odisha Distribution Limited (TPWODL) Anr. vs. Jagannath Sponge Private Limited (supra) wherein the Supreme Court has held that the clean slate principle will stand negated if the successful resolution applicant is asked to pay the arrears payable by the Corporate Debtor for the grant of an electricity connection in his/her name. The argument put by the respondent No. 1, by placing reliance on the case of State Tax Officer vs. Rainbow Papers Ltd. (supra) that any resolution plan which overrides statutory dues, is invalid and not binding to the mind of the Court, will have no application in the instant case, as firstly, the respondent No. 2 never filed any claim in accordance with law, and further the said decision was rendered ..... 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