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TMI Blog2025 (2) TMI 425X X X X Extracts X X X X X X X X Extracts X X X X ..... esolution Plan with a prayer to resumption of supply. Section 60(5) clearly indicates that under Section 60(5)(c) any question arising out of or in relation to the Insolvency Resolution or Liquidation proceeding of the Corporate Debtor is covered by the said definition. On looking into the reliefs and the concessions granted by the Order dated 21.09.2021, and the letter given by the Corporate Debtor on 29.10.2021, offering to make payment under the Resolution Plan and seeking restoration of supply, the said request clearly fell within Section 60(5)(c) - The NCLT had jurisdiction to entertain the application filed by the Respondent No.1 concerning the refund of pre-CIRP dues and compliance with the Resolution Plan. Extinguishment of claims of the Appellant for pre-CIRP dues, upon the approval of the Resolution Plan by the Adjudicating Authority - HELD THAT:- The law is well settled that by approval of the Resolution Plan, all dues and claims of pre-CIRP stand extinguished. In the present case, the DVC has filed its claim in the CIRP of ₹2,32,13,387/- for which an amount of ₹4,64,003/- was allocated for the Resolution Plan. Judgment of this Tribunal relied by the Respon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... und of pre-CIRP dues and compliance with the Resolution Plan. ii) The claims of the Appellant for pre-CIRP dues were extinguished upon the approval of the Resolution Plan, and the Appellant was not entitled to claim any additional pre-CIRP dues. iii) The Respondent No.1 was not estopped from claiming a refund of pre-CIRP dues, as the payments were made under duress to ensure the resumption of electricity supply. iv) The Appellant is not entitled for recovering any dues from the Respondent which relate to pre-CIRP period with regard to which claim was filed by the Appellant and was dealt in the Resolution Plan approved on 21.09.2021.
Appeal disposed off. X X X X Extracts X X X X X X X X Extracts X X X X ..... mount. xiii. A new Power Purchase Agreement 03.01.2022 was entered into between the Parties. xiv. On 13.05.2022, the Respondent filed an I.A. No. 463/KB/2022, praying for refund of the amount of ₹1,88,02,539/- wrongfully recovered from the R-1 on account of pre-CIRP dues and delayed payment surcharge. Direction was also sought to the Appellant to act in a strict compliance of the Order dated 21.09.2021. xv. In the Application, a Supplementary Affidavit was also filed by the Applicant, bringing on record certain other demands raised by the DVC. xvi. A Reply was filed by the Appellant to the I.A. Both the Applications were heard by the Adjudicating Authority being I.A.1336/2022 and I.A.463/2022. After hearing the Parties, the Adjudicating Authority allowed both the Applications. Adjudicating Authority directed the DVC to refund the amount received by it which was a pre-CIRP, including the delayed payment charges thereon within one month and further DVC was not to disconnect supply without following due course of law. xvii. Aggrieved by the aforesaid Order passed by the Adjudicating Authority, this Appeal has been filed. 3. We have heard Learned Counsel Ms. Madhumita Bh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Respondent No.1. It is submitted that Respondent No. 1 has written on 29.10.2021 for resumption of power supply after payment of ₹4.643 Lakhs as per NCLT Order dated 21.09.2021. Respondent asked the Appellant to inform as what else to be required to be done. In reply to the letter dated 29.10.2021, Appellant claimed payment to DVC of ₹1,72,23,024/- which included the pre-CIRP dues, which also stood extinguished in the CIRP process. The Respondent had no option left except to agree to illegal and unwarranted demand of Appellant to pay pre-CIRP dues and thus agreed to pay the instalments. The Adjudicating Authority has ample jurisdiction to entertain the Application filed by the Respondent No.1. The resumption of supply which was in favour of the Corporate Debtor, which has been now taken by the Successful Resolution Applicant (SRA) arose out of Insolvency Resolution Process and the submission of the Appellant that Application was not maintainable before the Adjudicating Authority is incorrect. The act of Appellant demanding the payment which stood extinguished in the CIRP process can very well be examined and entertained by the Adjudicating Authority and the Order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of Adjudicating Authority to supply respective utilities, including Power. Granted in terms of the Ghanashyam Mishra and Sons Pvt Lady Edelweiss Asset Reconstruction Company Ltd, wherein the Hon'ble Supreme Court has held that once a resolution plan is duly approved by the Adjudicating Authority under subsection (1) of section 31, the claims as provided in the resolution plan shall stand frozen and will be binding on the Corporate Debtor and its employees, members, creditors, including the Central Govt, any State Govt or any local authority, guarantors and other stakeholders. On the date of approval of resolution plan by the Adjudicating Authority, all 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. The Hon'ble Supreme Court also held that all the dues including the statutory dues owed to the Central Govt, any State Govt or any local authority, if not part of the resolution plan, shall stand extinguished and no proceedings in respect of such dues for the period prior to the date on which the Adjudicating ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m of Rs. 4,643/- lacs to DVC as approved by NCLT Order no. CP(IB) NO. 213/KB/2019 Dt. 21.09.2021. We would therefore, request you to kindly let us know what else is required to be submitted to DVC in order to get resumption of 1700 KVA load immediately. Thanks & Regards, For Mackeil Ispat & Forging Ltd." 10. The Appellant on 03.11.2021 wrote to the Corporate Debtor referring to its Clause 6.4.4 of the WBERC Regulation and stating that outstanding amount payable to DVC is ₹1,72,23,024/- as on 31.03.2021. The letter dated 03.11.2021 is as follows: "Coml/MIFL/2267 3rd November 2021 To Director, Mackeil Ispat & Forging Ltd. 5A /1A, Lord Sinha Road 2nd Floor, Amarsudha Building, Kolkata - 700 071 Re: Your Letter dated 29.10.2021 Sub: Resumption of electricity supply at factory premises of M/s Mackeil Ispat & Forging Ltd. Vill: Bamunara, Durgapur, Dist. Paschim Bardhaman. Dear Mr Saklecha, We are in receipt of your letter dated 29.10.2021 wherein you have acknowledged the transfer of the ownership, management and control of the business of M/s Mackeil Inspat & Forging Ltd. in favour of M/s Samriddhi Metals Private Limited by virtue of the order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In view of your stand as mention in para-2 above while we need the resumption of power supply on top-priory basis preferably within this week, we have no other option but to agree to your stand on liquidation of arrear dues. We would thereafter request you to kindly intimate the terms and condition such as security deposit, reconnection charges outstanding dues after payment of Rs.12,20,085.60 by us as mentioned above to get resumption of power supply on top priory basis. Thanks & Regards, For Mackeil Ispat & Forging Ltd." 12. In response to the letter dated 07.12.2021, the Appellant wrote on 07.12.2021, the payments which are required to be paid for resumption of supply. Letter dated 07.12.2021 is as follows: "No. Coml//MIFL/2552 Date: 07.12.2021 To The Director Mackeil Ispat & Forging Ltd. 5A/1A, Lord Sinha Road, Kolkata - 700 071 Sub: Regarding resumption of power supply at factory premises of M/s Mackeil Ispat Forging Ltd. [Old Consumer No. 440291] Ref: (i) Your Letter No. MIFL/DVC/21-22/02 dtd. 07.12.2021 (received vide email dtd. 07.12.2021) Dear Sir, This has reference to your letter dated 07.12.2021 mentioned under ref. (1) above reg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sd. B. Mondal (05.01.2022) Dy. Chief Engineer (Commercial)" 14. A new Power Purchase Agreement was also entered between the Parties on 05.01.2022. By Order dated 14.09.2023, two IAs filed by the Respondent have been allowed being I.A.1336/KB/2022 and I.A.463/2022. I.A.463/2022 has been brought on the record as (Annexure A-15) to the Appeal which Application was filed on 13.05.2022, where following reliefs were made: "a) To direct the Respondent to refund the sum of Rs.1,88,02,539/- wrongfully recovered by the Respondent from the Applicant No.1 on account of pre- CIRP dues and "Delayed Payment Surcharge" thereon, in excess of the amount apportioned and approved under the Resolution Plan of the Applicant No.2, alongwith interest thereon @ 12% per annum from the date when such excess payments were made to the Respondent, until recovery; b) To direct the Respondent to act in strict compliance of the order of this Tribunal dated September 21, 2021 passed in IA(IB) No. 398/KB/2021 in CP(IB) No.213/KB/2019 together with the Resolution Plan of the Applicant No.2; c) To restrain/injunct the Respondent from adjusting or claiming any further amounts in terms of its ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has been held: "10. In the present case, the Applicant No. 2 gave in to the demands made by DVC in order to ensure restoration of the electricity which was essential for the business operations of the Applicant No. 1. DVC has sought for claims that were due before the CIRP period and during the CIRP period as well." 17. Adjudicating Authority, ultimately in Paragraphs 13 to 16 directions have been issued and both the IAs have been allowed: "13. Thus, in view of the above relief granted, all the claims of DVC were extinguished, and DVC was bound by the same. The demands of DVC with respect to Pre- CIRP and CIRP period dues of DVC at this stage is in contravention to the Code and principles laid down with respect to the Code in terms of the above referred judgment. 14. In view of the above, we direct DVC to refund the amount received by it which was of Pre-CIRP including the Delayed payment surcharge thereon within one month from the date of this order. Further, DVC shall not disconnect the supply of electricity without following the due course of law. 15. The above directions shall not be construed as any manner, a relaxation of any fees or charges payable by the Applica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssions granted therein. Corporate Debtor/SRA was requesting to implement the Order to the DVC. 22. Now we come to the reliefs claimed in both the Applications. A perusal of the Order of Adjudicating Authority indicates that consideration of Adjudicating Authority is in the Impugned Order is only confined to the I.A.463/2022 by which the refund was claimed and the basis of the refund claim was that the DVC cannot claim any pre-CIRP dues which has been extinguished by approval of the Resolution Plan. 23. The law is well settled that by approval of the Resolution Plan, all dues and claims of pre-CIRP stand extinguished. In the present case, the DVC has filed its claim in the CIRP of ₹2,32,13,387/- for which an amount of ₹4,64,003/- was allocated for the Resolution Plan. Judgment of this Tribunal relied by the Respondent in the matter of 'Damodar Valley Corporation' Vs. 'Kharkia Steels Pvt. Ltd. & Ors.' reported in (2022) SCC OnLine NCLAT 2282, as well as the Judgment of the Hon'ble Supreme Court in 'Paschimanchal Vidyut Vitran Nigam Ltd.' Vs. 'Raman Ispat Pvt. Ltd. & Ors.' reported in (2023) 10 SCC 60 as well as the Judgment of the Hon'ble Supreme Court in 'Ghanshyam Mis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -CIRP period was clearly illegal and contrary to the law laid down by the Hon'ble Supreme Court and any such amount which has been obtained by the Appellant from the Respondent cannot be allowed to be retained by the Appellant. 27. As noted above, the Order of the Adjudicating Authority, Paragraph 10 itself indicates that Appellant has sought for claims that were due before the CIRP period and during the CIRP period as well. No issue can be raised regarding any claim prior to CIRP period since, the claim said after approval of the Resolution Plan and payment of amount under the Plan to the Appellant stood extinguished. It is however relevant to notice that no bifurcation and details have been given as to what was the claim prior to CIRP period and what was the claim subsequent to the CIRP period as was communicated by the Appellant vide letter dated 07.12.2021. On the record, there are also no details to come to the conclusion that how much amount as communicated in letter dated 07.12.2021 was during the CIRP period and what was the amount prior to CIRP period. The Impugned Order passed by the Adjudicating Authority cannot be faulted insofar as is directed for refund of the amount ..... 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