IBC liquidation dues cannot be fastened on a going-concern purchaser as a condition for fresh electricity connection.

In IBC liquidation, a purchaser of assets sold as a going concern is not automatically liable for the corporate debtor's pre-liquidation electricity dues. The liquidation framework is a complete code: the liquidator must deal with claims and distribute sale proceeds only under the statutory waterfall in Section 53, and liabilities carried forward in a going-concern sale are limited to those identified under the liquidation regulations. The Court held that the distribution licensee's dues do not create a charge on the debtor's assets, and an "as is where is" clause cannot override the Code. The demand for clearance of the erstwhile owner's dues as a condition for a fresh connection was unlawful.

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Issues: Whether the distribution licensee could insist on payment of the erstwhile owner's outstanding electricity dues as a precondition for granting a fresh electricity connection to the purchaser of assets sold in IBC liquidation as a going concern.

Analysis: The liquidation scheme under the Insolvency and Bankruptcy Code, 2016 is a complete code. Once corporate insolvency resolution fails, liquidation commences and the liquidator is required to verify claims, consolidate them, admit or reject them, and distribute sale proceeds strictly in the order prescribed by the statutory waterfall in Section 53. The liquidation regulations permit sale of the corporate debtor or its business as a going concern, but the liabilities carried forward in such a sale are only those identified and grouped for that purpose in the manner contemplated by the regulations. That framework does not support automatic transfer of all pre-liquidation liabilities to the purchaser. The Court also held that the electricity distribution licensee's dues do not create a charge on the corporate debtor's assets and that contractual expressions such as "as is where is" cannot override the statutory regime under the Code.

Conclusion: The insistence on clearing the erstwhile owner's outstanding dues before granting a new electricity connection was unlawful and was set aside in favour of the petitioner.

Ratio Decidendi: In a sale of assets or business under IBC liquidation, pre-liquidation dues are not automatically fastened on the purchaser, and demands inconsistent with the statutory liquidation waterfall and the liquidation regulations cannot be enforced as a condition for post-sale supply or reconnection of electricity.

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