# In the matter of Shailesh Verma
Vs.
Maharashtra State Electricity Distribution
Company Limited Company Appeal (AT) (Insolvency) No. 383 of 2022

> NCLAT judgment dated 2022-09-02. Citation: TCN-2022-NCLAT-00244. The Resolution Professional of Lavasa Corporation Limited filed an appeal challenging the…

- **Court:** NCLAT
- **Order date:** 2 Sept 2022
- **Citation:** TCN-2022-NCLAT-00244
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/shailesh-verma-vs-maharashtra-state-electricity-distribution-company-limited-com-8d48b3ea

## Summary

### Background

The Resolution Professional of Lavasa Corporation Limited filed an appeal challenging the order dated 21.01.2022 passed by the National Company Law Tribunal, Mumbai Bench-Court II, which partly allowed IA No. 1661 of 2021. The Adjudicating Authority directed the Respondent (Maharashtra State Electricity Distribution Company Limited - MSEDCL) not to take over the Distribution Franchisee Agreement (DFA) and to continue supplying uninterrupted electricity to the Corporate Debtor (Lavasa Corporation Limited). The Resolution Professional was also directed to pay the outstanding dues during the CIRP period within 90 days. The appeal contests the direction to pay outstanding dues during the CIRP period.

## Facts

Lavasa Corporation Limited (Corporate Debtor) entered into a Distribution Franchisee Agreement (DFA) with Maharashtra State Electricity Distribution Company Limited (MSEDCL) on 2011-03-15, where MSEDCL was to supply electricity to the Corporate Debtor's township. The DFA expired on 2019-10-24. MSEDCL notified its intention not to renew the DFA on 2021-07-09. The Corporate Insolvency Resolution Process (CIRP) against Lavasa Corporation Limited commenced on 2018-08-30. The Resolution Professional filed IA No. 1661 of 2021 seeking to quash MSEDCL's notices and restrain them from taking over the franchisee infrastructure, requesting continued electricity supply. The Adjudicating Authority partly allowed the application, directing the Resolution Professional to pay

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## Issues and analysis

### Issue 1: Whether the Adjudicating Authority was right in directing the Appellant to make payment of …

**Ratio:** Section 14(2) of the IBC provides that the supply of essential goods or services to the

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**Reasoning:** The court reasoned that the Corporate Debtor, through the Resolution Professional, had

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**Interpretation:** Section 14(2) and 14(2-A) of the IBC, read with the Statement of Objects and

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**Application:** In this case, the Corporate Debtor required continued electricity supply to

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## Parties

- **Judges:** Ashok Bh…; M. Satyanarayana…; +1 more
- **Appellants:** Shailesh…
- **Respondents:** Lavasa Corporation…; MAHARASHTRA STATE…

## Timeline

- **2011-03-15 — DFA Agre…**: Lavasa Corporation Limited entered into a Distribution Franchisee Agreement (DFA) with…
- **2018-08-30 — CIRP Commen…**: Corporate Insolvency Resolution Process (CIRP) against Lavasa Corporation Limited…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 14 — Moratorium](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-14)

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