TaxTMI 
TaxTMI 
2024 (9) TMI 1179
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....2017. By the impugned order, the Adjudicating Authority has allowed the IA No. 2187 of 2020 filed by Respondent No. 1 and disposed of IA No. 320 of 2021, IA No. 340 of 2021 and IA No. 1534 of 2021 filed by the Appellant by holding them to be infructuous. Aggrieved by the impugned order, the present appeals have been preferred by the Appellant. 2. Coming to the factual matrix, the salient events/developments being common, the same are as outlined below: The Corporate Debtor-M/s Shirdi Industries Ltd. was admitted into Corporate Insolvency Resolution Process ('CIRP' in short) on 18.05.2017 following which moratorium under Section 14 of the IBC was declared against the Corporate Debtor. As on the insolvency commencement date i.e. 18.05.2017, an amount of Rs 1.76 cr. was due and payable by the Corporate Debtor to the Appellant-Uttarakhand Power Corporation Ltd. ('UPCL' in short) towards electricity bills for the months of April and May, 2017 which fell during the pre-CIRP period. The dues pertaining to April and May, 2017 amounting Rs 1.76 cr. was paid by the Respondent on 19.05.2017 and 19.06.2017 i.e. after the commencement of CIRP. The Resoluti....
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....ade with effect from the date of approval of the resolution plan. The Appellant thereafter filed IA No. 340 of 2021 and IA No. 1534 of 2021 praying for recall of interim orders dated 03.12.2020 and 04.02.2021. IA No. 320 of 2021 was also filed seeking permission to file an additional affidavit in response to I.A. No. 2187 of 2020. On 21.02.2024, the Adjudicating Authority passed the final order by which the pre-CIRP dues were to be paid by the Corporate Debtor in accordance with the approved resolution plan and amount, if any, paid by the Corporate Debtor after insolvency commencement date be appropriated towards the dues which became payable on account of availing of services during CIRP period. Both parties were directed to reconcile their dues and the Corporate Debtor was directed to make payment within 30 days from the date of their order. This order also disposed of IA No. 340 of 2021 and IA No. 1534 of 2021 as infructuous. Aggrieved by the impugned order, the Appellant has preferred the present set of three appeals for setting aside the impugned order and seeking direction to the Respondents to make payment of the total outstanding electricity dues ....
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....rrent power charges as on 05.03.2024. The Appellant therefore vociferously contended for permission to disconnect the electricity supply of the Corporate Debtor in view of the continuous and wilful default on their part and nonpayment of arrears. 6. Rebutting the arguments raised by the Appellant, the Ld. Counsel for the Respondents pressed hard their contention that the Adjudicating Authority while approving the resolution plan vide its order dated 12.12.2017 had held that the Corporate Debtor was liable to pay pre-CIRP dues of the Appellant in 8 quarterly instalments from June 2022 to March 2024. Hence pre-CIRP dues was therefore payable to the Appellant only in terms of the approved Resolution Plan. Since the pre-CIRP dues of the Appellant had been paid in May-June 2017, which was otherwise payable between June 2022 to March 2024 as per the resolution plan, the Respondents were entitled to adjust this amount against the current/future electricity bills which arose during CIRP period. 7. It was also contended that in terms of Section 238 of IBC, the statutory provisions of IBC over-ride any commercial and contractual covenants which are in conflict with the IBC. Further, in....
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....e approval of the resolution plan in respect of pre-CIRP dues and that LPS shall be levied to the extent that such dues are not paid in accordance with the resolution plan. 12. Coming to the findings of the Adjudicating Authority in this regard, the relevant excerpts are as extracted hereunder: "45. It is not in dispute that the dues pertaining to April and May 2017 (17 days) were paid by the Applicant on 19.05.2017 and 19.06.2017. This payment was made after the commencement of CIRP, i.e. 18.05.2017 by the Corporate Debtor. It is trite law that the outstanding dues of the Creditors as on commencement of Corporate Insolvency Date are to be settled in terms of the approved Resolution Plan. Accordingly, the payment of any dues pertaining to that period subsequent to the Insolvency Commencement date prior to approval of Resolution Plan is not permissible. We note that the Approved Resolution Plan contemplate payment of all operational debts due as on Insolvency Commencement date in the books of Corporate Debtor, irrespective of fact whether any claim was filed by such creditor. The approved Resolution Plan contemplate payment of operational creditors dues, as appearing in ....
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.... plan, the pre-CIRP dues were to be made good in 8 quarterly instalments commencing from June 2022 to March 2024. It is pertinent to note that though the Appellant had admittedly not filed their claims during CIRP, the payment of pre-CIRP dues of the Appellant had been provided for in the resolution plan. As the law stands today, no exception can be taken to such a plan as long as it provided for payment to the Appellant in accordance with Section 30(2)(b) of the IBC. In any case, the present is not a case where the Appellant is contending that payment of their dues is not as per provisions of Section 30(2)(b) of the IBC. It is neither a case where the Appellant is claiming entitlement to receive any higher amount in respect of pre-CIRP dues. Furthermore, the resolution plan not having been challenged, the terms of the resolution plan had attained finality and become binding on all stakeholders including the Appellant. 14. This brings us to the conduct of the Respondent with respect to handling of the pre-CIRP dues of the Appellant vis a vis the terms set out in the resolution plan. We do not find the Appellant to have raised any dispute that the Respondent by their conduct had ....
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....e commencement of insolvency which reads as under: "14. Moratorium- (1) Subject to provisions of sub-sections (2) and (3), on the insolvency commencement date, the Adjudicating Authority shall by order declare moratorium for prohibiting all of the following, namely :- (a)..... (b) transferring, encumbering, alienating or disposing of by the corporate debtor any of its assets or any legal right or beneficial interest therein; (c) ..... (d) .... Explanation.-For the purposes of this sub-section, it is hereby clarified that notwithstanding anything contained in any other law for the time being in force, a license, permit, registration, quota, concession, clearances or a similar grant or right given by the Central Government, State Government, local authority, sectoral regulator or any other authority constituted under any other law for the time being in force, shall not be suspended or terminated on the grounds of insolvency, subject to the condition that there is no default in payment of current dues arising for the use or continuation of the license, permit, registration, quota, concession, clearances or a similar grant or right ....
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....been paid voluntarily not been reappropriated towards assets of the Corporate Debtor, it would have amounted to preferential treatment to the Appellant and attracted Section 43 of the IBC vitiating the resolution process. 17. When we look at the impugned order, we find that the Adjudicating Authority has rightly observed that any payment made by the Corporate Debtor to the Appellant after the insolvency commencement date cannot be appropriated towards electricity charges which have arisen prior to or became due as on the insolvency commencement date and that such payment, if already made, must be appropriated only towards the dues which become payable during CIRP period on account of availing of services during CIRP period only. Hence, any amount, if paid, by the Corporate Debtor after insolvency commencement date shall only be adjusted against CIRP dues while pre-CIRP dues shall be paid in accordance with the approved resolution plan. By the same logic, the Adjudicating Authority has also rightly held that LPS shall be levied in accordance with the payment structure and timeline as envisaged under the approved Resolution Plan and shall be computed in relation to pre-CIRP dues t....