NISHANT
Electricity authorities are not entitled to disconnect power supply, being essential service with reference to corporate debtor, for non-payment of electricity bill during the moratorium period
NISHANT MEHROTRA 16 May 2018

Electricity authorities are not entitled to disconnect power supply, being essential service with reference to corporate debtor, for non-payment of electricity bill during the moratorium period

NCLT Ahemdabad Bench :: Insolvency and Bankruptcy Code, 2016 – Section 14 – Moratorium – Supply of essential service to corporate debtor – Power of Adjudication Authority to declare – Can electricity authorities disconnect power supply to corporate debtor – Whether the electricity authorities are not entitled to disconnect the power supply to the corporate debtor for non-payment of electricity bill during the moratorium period invoking section 56 of the Electricity Act, 2003 – Held, yes – Whether the electricity company can claim the power consumption charges as an ‘operational creditor’ from the assets of the corporate debtor on par with other operational creditors based on priorities given in the Code and the Rules and Regulations – Held, yes – Whether, therefore, the corporate debtor/applicant resolution professional is not absolved from paying the charges – Held, yes.


Case:

ABG Shipyard Ltd. v. ICICI Bank Ltd.

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