TMI Blog2021 (6) TMI 343X X X X Extracts X X X X X X X X Extracts X X X X ..... ptcy Code, 2016 - Application allowed. - IA 1444 of 2020 in CP (IB) 1704/MB/2017 - - - Dated:- 10-5-2021 - Harihar Prakash Chaturvedi, Member (J) And Ravikumar Duraisamy, Member (T) For the Appellant : Rahul Gaikwad and Nikita Abhyankar, Advocates i/b Gravitas Legal For the Respondents : Akash Kothari, Advocate i/b Little Co. ORDER Ravikumar Duraisamy, Member (T) 1. The Applicant is the Successful Resolution Applicant of the erstwhile Corporate Debtor. The Resolution Plan of the Applicant was approved by the Committee of Creditor of the Corporate Debtor and thereafter it was also approved by this Tribunal vide its Order dated October 14, 2019. After satisfying all clauses of the Resolution Plan, the Applicant took complete possession of the Corporate Debtor on July 7, 2020. 2. The Respondent No. 1 (Rl) is Maharashtra State Electricity Distribution Company Ltd. ( MSEDCL ) wherein MSEDCL is responsible for supply of electricity 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 Ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2016 against the Ambey Iron Pvt. Ltd., being the then Corporate Debtor. The said Company Petition was admitted vide an Order dated March 22, 2018 thereby initiating Corporate Insolvency Resolution Process ( CIRP ) against the Corporate Debtor. 6. After due consideration the Resolution Plan was approved by the Committee of Creditors of the Corporate Debtor by 100% majority during its 9th meeting. 7. The aforementioned Order dated October 14, 2019 specifically states at para 18 that no claim can be added in the proposed Resolution Plan and that all such claims are subject to Clause 10 of the Resolution Plan. The contents of the said Order dated October 14, 2019 at para 18 is reproduced herein for ready reference: 18. That, the Resolution Applicant in one of the Clauses has raised an apprehension about the claim of any Creditor, yet to be raised, being not lodged during Corporate Insolvency Resolution Process period before the Ld. RP. It is hereby made clear that all the claims 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cleansed entity for cases which result in change in the management or control of the Corporate Debtor, so that such Resolution Applicants would have a fair chance to revive the unit which otherwise would directly go into liquidation. The Committee believed that such ring-fencing is essential to achieve revival or resolution without imposing additional liabilities on the Resolution Applicant, arising from mala fide acts of the previous promoter or management. 13. The Applicant emphasized upon the position in law is also cemented by the Hon'ble Supreme 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) wherein the Hon'ble Apex Court has held that: a successful resolution applicant cannot suddenly be faced with undecided claims after the resolution plan being submitted by him. All claims must be submitted to and decided by the resolution professional so that a prospective resolution applicant knows exactly what has 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. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .e. for five instalments in five months and the Respondent has not recovered sixth instalment of the AEC charges for the billing month of January 2014 from the Corporate Debtor. Thus, one installment towards AEC charges remain unpaid. Meanwhile the Government of Maharashtra vide its GR dated 29th January 2014 granted general subsidy to the consumer towards tariff including subsidy for AEC charges. Before the Government Resolution dated 29th January, 2014, the Respondent had already recovered five installments of AEC's in five monthly bills from the Corporate Debtor. Only one installment of AEC was pending to be recovered by the Respondent from the Corporate Debtor. The Respondent made implication of the said GR dated 29th January 2014 and therefore the Respondent has not recovered the AEC charges for the billing month of January 2014 from the Corporate Debtor and also reduced the tariff of the Corporate Debtor for the months beginning from January, 2014 to November, 2014. 19. Since, electricity connection at the premises of Corporate Debtor was disconnected, MSEDCL had refunded balance amount of security deposit after deducting the outstanding bill amount to the Corporate De ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly 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 disconnect any electric supply line or other works being the property of such licensee or the generating company through which electricity may have been supplied, transmitted, distributed or wheeled and may discontinue the supply until such charge or other sum, together with any expenses incurred by him in cutting off and reconnecting the supply, are paid....... Regulation 10.5 of Maharashtra Electricity Regulatory Commission (Electricity Supply Code and other Conditions of Supply) Regulations 2005 stipulates: Regulation 10.5: Any charge for electricity or any sum other than a charge for electricity due to the Distribution Licensee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , may sell away the property and move on to another property, thereby making it difficult, if not impossible for the distributor to recover the dues. Having regard to the very large, number of consumers of electricity and the frequent moving or translocating of industrial, commercial and residential establishments, provisions similar to clause 4.3(g) and h) of Electricity Supply Code are necessary to safeguard the interests of the distributor. We do not find anything unreasonable in a provision enabling the distributor/supplier, to disconnect electricity supply if dues are not paid, or where the electricity supply has already been disconnected for non-payment, insist upon clearance of arrears before afresh electricity connection is given to the premises. It is obviously the duty of the purchasers/occupants of premises to satisfy themselves that there are no electricity dues before purchasing, 'occupying a premises. They can also incorporate in the deed of sale or lease, appropriate clauses making the vendor/lessor responsible for clearing the electricity dues up to the date of sale/lease and for indemnity in the event they are made liable. Be that as it may. 12. In this ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l Appeal Diary No. 24417 of 2019) are concerned, the 6 resolution professional admitted the claim of the abovementioned respondents notionally at INRI on the ground that there were disputes pending before various authorities in respect of the said amounts. However, the NCLT through its judgment dated 08.03.2019 directed the resolution professional to register the entire claim of the said respondents. The NCLAT in paragraphs 43 and 196 of the impugned judgment upheld the order passed by the NCLT as aforesaid and admitted the claim of the above-mentioned respondents. We therefore hold that this part of the impugned judgment deserves to be set aside on the ground that the resolution professional was correct in only admitting the claim at a notional value of LNR 1 due to the pendency of disputes with regard to these claims. It is humbly to be noted that the said judgment does not apply to the present case as in the present case there is no dispute pending with regards to the amount of outstanding arrears to be paid by Corporate Debtor to the Respondent and therefore in the interest of equity and justice, Application taken out by the Applicant be dismissed. 30. In the view of fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an, and even if it is forthcoming, it is not fair to the interest of the corporate debtor and the other stake holders. 280. We are of the clear view that no case whatsoever is made out to seek invalidation of Section 32A. The boundaries of this Court's jurisdiction are clear. The wisdom of the legislation is not open to judicial review. Having regard to the object of the Code, the experience of the working of the code, the interests of all stakeholders including most importantly the imperative need to attract resolution applicants who would not shy away from offering reasonable and fair value as part of the resolution plan if the legislature thought that immunity be granted to the corporate debtor as also its property, it hardly furnishes a ground for this Court to interfere. The provision is carefully thought out. It is not as if the wrongdoers are allowed to get away. They remain liable. The extinguishment of the criminal liability of the corporate debtor is apparently important to the new management to make a clean break with the past and start on a clean slate. We must also not overlook the principle that the impugned provision is part of an economic measure. The rever ..... X X X X Extracts X X X X X X X X Extracts X X X X
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