# In the matter of Reliance Infratel Limited vs. State of Meghalaya & Ors.

> HC judgment dated 2024-06-05. Citation: TCN-2024-HC-00077. Reliance Infratel Limited (RITL), admitted to insolvency on 2019-05-07, faced a demand for…

- **Court:** HC
- **Order date:** 5 Jun 2024
- **Citation:** TCN-2024-HC-00077
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/high-courts-new-delhi/reliance-infratel-limited-vs-state-of-meghalaya-ors-dd8b7346

## Summary

### Background

Reliance Infratel Limited (RITL), admitted to insolvency on 2019-05-07, faced a demand for outstanding electricity dues from Meghalaya Power Distribution Corporation Ltd. (MePDCL) for periods before RITL's takeover by Reliance Projects and Property Management Solutions Ltd. (RPPMSL) on 2022-12-22. MePDCL also threatened to disconnect existing electricity connections and refused new connections to RITL and its affiliates. RITL challenged MePDCL's demand notice, arguing that the approved resolution plan extinguished prior dues and that MePDCL did not participate in the insolvency resolution process.

## Facts

Reliance Infratel Limited (RITL) was admitted to insolvency with effect from 2019-05-07. A resolution plan was submitted by Reliance Projects and Property Management Solutions Ltd. (RPPMSL) for the takeover of RITL, which was approved by the National Company Law Tribunal (NCLT) and the Supreme Court. RPPMSL took over RITL on 2022-12-22. Meghalaya Power Distribution Corporation Ltd. (MePDCL) sought recovery of electricity dues from RITL for periods prior to the takeover under the Insolvency Code and threatened to disconnect existing electricity connections and refused to provide new electricity connections. RITL challenged the demand notice, arguing that the approved resolution plan extinguished prior dues. The Resolution Professional had informed the State Electricity

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## Issues and analysis

### Issue 1: Whether Meghalaya Power Distribution Corporation Ltd. (MePDCL) is entitled to recover outstanding …

**Ratio:** An approved resolution plan is binding on all creditors, including governmental

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**Reasoning:** The court reasoned that MePDCL, by not participating in the Corporate Insolvency

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**Interpretation:** Section 31 of the IBC mandates that an approved resolution plan is binding on

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**Application:** In this case, MePDCL's attempt to recover dues prior to 2022-12-22 (the

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## Parties

- **Judges:** H. S. Than…
- **Appellants:** M/s Reliance…
- **Respondents:** Reliance Infratel…; State of Me…
- **Advocates:** VVV Sa…; H. Abr…; +2 more

## Timeline

- **2019-05-07 — Insolvency Ad…**: Reliance Infratel Limited…
- **2019-07-25 — Notification to…**: The Resolution Professional addressed a letter to all the State Electricity Boards…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 31 — Approval of resolution plan](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-31)

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