Tribunal Upholds Relief for New Connection to Successful Resolution Applicant

The Tribunal upheld the legality of the relief granted by the Adjudicating Authority directing DVC to provide a new connection to the Successful Resolution Applicant (SRA) after payment of the security deposit. It determined that the resolution plan, which included extinguishing DVC's past dues and liabilities, was within the Adjudicating Authority's jurisdiction under the Insolvency and Bankruptcy Code. The Tribunal emphasized compliance with relevant regulations and upheld the direction for a new temporary connection with modifications ensuring adherence to WBERC Regulations. The appeal was disposed of without costs, requiring the SRA to apply for a fresh connection and comply with regulations.

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Issues Involved:
1. Legality of the relief granted by the Adjudicating Authority while the main appeal was pending.
2. Jurisdiction of the Adjudicating Authority under IBC in granting relief related to electricity supply.
3. Treatment of DVC's past dues and liabilities under the approved Resolution Plan.
4. Compliance with WBERC Regulations and the Electricity Act in providing a new electricity connection.

Detailed Analysis:

1. Legality of the Relief Granted by the Adjudicating Authority:
The main issue in this appeal is whether the relief granted by the Adjudicating Authority directing DVC to provide a new connection to the Successful Resolution Applicant (SRA) after payment of the security deposit could have been given while the main appeal was pending. The Tribunal noted that the legal validity of the resolution plan as approved by the Adjudicating Authority had already been considered and upheld in a separate appeal (CA (AT)(Ins) No. 1111 of 2019). Therefore, the Tribunal limited its consideration to the propriety of the order directing DVC to grant a new temporary connection after payment of the security deposit.

2. Jurisdiction of the Adjudicating Authority under IBC:
The Appellant argued that the Adjudicating Authority exceeded its jurisdiction by approving a resolution plan that took away the rights of the Appellant under the Electricity Act and WBERC Regulations. The Tribunal, however, held that the approved resolution plan, which extinguished DVC’s past dues and directed the provision of a new electricity connection, was within the jurisdiction of the Adjudicating Authority under IBC. The Tribunal emphasized that the resolution plan must be implemented in accordance with the relevant regulations and that the commitment to supply power should comply with the WBERC Regulations.

3. Treatment of DVC's Past Dues and Liabilities:
The Tribunal noted that the approved resolution plan included specific provisions for the treatment of DVC's liabilities. These liabilities, which were considered operational debts, were extinguished under the resolution plan, and DVC was prohibited from raising further demands for past dues. The plan directed DVC to restore the power connection and commit to supplying power to the plant at the same rate as adjoining units. The Tribunal found that the resolution plan's provisions regarding the extinguishment of DVC's past dues were legally sound and did not suffer from any infirmity.

4. Compliance with WBERC Regulations and the Electricity Act:
The Tribunal held that while the resolution plan directed DVC to ensure continuous power supply, this commitment should be in accordance with the WBERC Regulations made under the Electricity Act. The Tribunal modified the conditions to specify that the supply of electricity to the corporate debtor should be at the tariff rate and conditions prevailing at the time of signing the agreement for a fresh connection. The Tribunal affirmed that the direction to provide a new temporary connection was proper and legal, with the slight modification that the SRA must comply with WBERC Regulations.

Conclusion:
The Tribunal concluded that the direction given by the Adjudicating Authority to DVC to provide a temporary connection to the SRA was in accordance with a legally approved resolution plan and did not suffer from any illegality. The appeal was disposed of with the clarification that the SRA must apply for a fresh connection and comply with the WBERC Regulations. There was no order as to costs.

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