Power company cannot demand arrears under Insolvency Code for electricity connection. Court clarifies tribunal's jurisdiction.

The Supreme Court held that the power distribution company cannot demand payment of arrears for granting an electricity connection as per the Insolvency and Bankruptcy Code, 2016. The Court emphasized the importance of adhering to the Code's provisions, specifically Section 53, and highlighted the clean slate principle. Additionally, the Court clarified the jurisdiction of the tribunal under the Code in cases where government dues are finalized. The appeals were dismissed, upholding the lower court's decision, and any pending applications were disposed of accordingly.

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Issues involved: Interpretation of provisions of the Insolvency and Bankruptcy Code, 2016 in relation to payment of arrears for grant of electricity connection.

Judgment Summary:

The Supreme Court held that the legal issue at hand is governed by a previous judgment of the Court. The appellant, a power distribution company, cannot demand payment of arrears for the grant of an electricity connection as per the waterfall mechanism. However, the successful resolution applicant must fulfill other requirements for the connection. Insisting on arrears payment would contradict the clean slate principle. The Court emphasized the overriding effect of the Code's provisions, specifically Section 53 regarding debt payment.

Regarding reliance on other judgments, the Court clarified that a case involving renewal of a mining lease does not fall under insolvency resolution matters. However, if government dues are finalized, they must be paid as per the approved resolution plan. The tribunal under the Code has jurisdiction if the power company insists on corporate debtor dues for electricity connection restoration.

Ultimately, the Court dismissed the appeals, finding no valid reason to interfere with the lower court's decision. Any pending applications were disposed of accordingly.

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