# In the matter of Southern Power Distribution Company of Andhra Pradesh Ltd. Through Superintending Engineer vs. Rakesh Kumar Singla Liquidator of Apple Industries Ltd. & Ors.

> NCLAT judgment dated 2025-02-07. Citation: TCN-2025-NCLAT-00231. The appeal was filed against an order passed by the NCLT, New Delhi Bench, Court-2. There was…

- **Court:** NCLAT
- **Order date:** 7 Feb 2025
- **Citation:** TCN-2025-NCLAT-00231
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/southern-power-distribution-company-of-andhra-pradesh-ltd-through-superintending-66d46868

## Summary

### Background

The appeal was filed against an order passed by the NCLT, New Delhi Bench, Court-2. There was a difference of opinion between the two members of the NCLT, so the matter was referred to a third member, who delivered their opinion on 2024-06-14. The appellant, Southern Power Distribution Company of Andhra Pradesh Ltd., challenged the order in this appeal, praying for appropriate orders and directions.

## Facts

Southern Power Distribution Company of Andhra Pradesh Ltd. filed an appeal against an order passed by the NCLT, New Delhi Bench, Court-2. The NCLT members had differing opinions, leading to a referral to a third member. The appeal arises from a liquidation proceeding where the Appellant's claim was admitted. The core issue is the extinguishment of liabilities of the Corporate Debtor after the sale of the Corporate Debtor as a going concern under Regulation 32(e) of IBBI (Liquidation Process) Regulations, 2016, and distribution of proceeds under Section 53 of the IBC, 2016. The Appellant argues that blanket extinguishment without a hearing prejudices their rights, especially concerning CIRP and liquidation costs. The Respondent contends there is no foundation to the

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## Issues and analysis

### Issue 1: Whether the blanket extinguishment of liabilities without hearing the Appellant causes prejudice in …

**Ratio:** The principle is that liabilities existing on the liquidation commencement date, for

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**Reasoning:** The court reasoned that the distribution has been undertaken to all stakeholders

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**Interpretation:** This issue concerns the scope and fairness of extinguishing liabilities in a

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**Application:** The court applied the principle by clarifying that the extinguishment applies

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## Parties

- **Judges:** Ashok Bh…; Barun M…; +1 more
- **Appellants:** Southern Power…
- **Respondents:** Apple Industries…; Rakesh Kumar…

## Timeline

- **2024-06-14 — Third Member…**: The third member of the NCLT delivered their opinion due to a difference of opinion…
- **2025-02-07 — Hearing of th…**: The NCLAT heard the learned counsel for…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 53 — Distribution of assets](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-53)

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