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2022 (3) TMI 604 - AT - Insolvency and BankruptcyRestoration of power connection to the Corporate Debtor for getting a better resolution plan - seeking reconnection of power supply of the Durgapur factory of Corporate Debtor within 15 days on deposit of current electricity dues from the date of initiation of CIRP without payment of past dues and any security deposit from the Corporate Debtor - HELD THAT:- From the provision in Section 14(2) of IBC, it is found that supply of essential goods or services to the Corporate Debtor shall not be terminated or suspended or interrupted during moratorium period. The essential goods and supplies have been defined and explained through an illustration in Regulation 32 of the CIRP Regulations wherein it is clarified that essential goods and services referred to in Section 14(2) shall be considered essential supplies only to the extent they are not a direct input to the output produced or supplied by the Corporate Debtor. Moreover, under Section 14(2-A) the IRP/RP can ask for continuation of the supply of such goods and services which are critical to protect and preserve the value of the Corporate Debtor and manage the operations of such Corporate Debtor as a going concern. Admittedly the disconnection of the electricity supply to the Durgapur unit took place on 14.9.2019. According to clause 4.6.1 of the Power Supply Agreement, deemed termination of the agreement could happen only after 180 days from the date of disconnection. Thus deemed termination could have taken place on or after 12.3.2020 i.e. 180 days after the date of disconnection. The order for initiation of CIRP was passed on 17.12.2019 and moratorium was imposed under section 14 from the same date. Thus the deemed termination of the Power Supply Agreement to the Durgapur unit of the corporate debtor which could not take place by 17.12.2019, could not happen during the moratorium period, by virtue of protection provided under Section 14(2) - It is also noted that the IRP has asked for reconnection of the electricity supply so that a ‘better’ resolution plan can be obtained in the resolution of the CD which is the intent of the IBC. In passing the Impugned order by which directions have been given to DVC for reconnection of the electricity supply to the corporate debtor during the moratorium period and also allowing waiver of security deposit, the Adjudicating Authority has not exceed its jurisdiction under the IBC - impugned order upheld. Appeal dismissed.
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