# In the matter of Ambey Iron Private Limited IA 1444 of 2020 In CP (IB) 1704-MB-2017

> NCLT judgment dated 2021-05-10. Citation: TCN-2021-NCLT-02173. The case involves an application (IA 1444 of 2020) filed under Section 60(5) of the Insolvency…

- **Court:** NCLT
- **Order date:** 10 May 2021
- **Citation:** TCN-2021-NCLT-02173
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/ambey-iron-private-limited-ia-1444-of-2020-in-cp-ib-1704-mb-2017-02c39953

## Summary

### Background

The case involves an application (IA 1444 of 2020) filed under Section 60(5) of the Insolvency and Bankruptcy Code, 2016, read with Rule 11 of the NCLT Rules, 2016, by Bhadrashree Steel & Power Limited, the successful resolution applicant (SRA) of Ambey Iron Private Limited (erstwhile Corporate Debtor). The SRA sought directions from the Adjudicating Authority regarding electricity dues claimed by Maharashtra State Electricity Distribution Company Ltd. (MSEDCL), the respondent. The resolution plan for Ambey Iron Private Limited had been approved by the Committee of Creditors and the NCLT. After the approval, the SRA applied for a new electricity connection, but MSEDCL demanded arrears from the Corporate Debtor, leading to the current application.

## Facts

In 2017, Oriental Bank of Commerce initiated CIRP against Ambey Iron Pvt. Ltd. under Section 7 of the IBC. The resolution plan submitted by Bhadrashree Steel & Power Limited was approved by the CoC and the NCLT on October 14, 2019. Bhadrashree took possession of Ambey Iron on July 7, 2020. MSEDCL disconnected electricity to Ambey Iron on December 31, 2014, due to unpaid dues. MSEDCL deducted Rs. 29,78,500 from Ambey Iron's security deposit and refunded the balance, issuing a No Dues Certificate on March 11, 2015. Later, MSEDCL claimed arrears of Rs. 2,16,847 from Bhadrashree. Bhadrashree paid Rs. 2,17,000 under protest and sought a new electricity connection. MSEDCL argued that under Section 56(1) of the Electricity Act, it was obligated to recover outstanding

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## Issues and analysis

### Issue 1: Whether MSEDCL can demand outstanding electricity dues from the successful resolution applicant …

**Ratio:** A resolution plan approved by the Committee of Creditors (CoC) and the Adjudicating

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**Reasoning:** The NCLT reasoned that once a resolution plan is approved, it binds all stakeholders.

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**Interpretation:** The interpretation of Section 31(1) of the IBC emphasizes the binding nature of

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**Application:** In this case, the NCLT applied the principle that the approved resolution plan

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## Parties

- **Judges:** Harihar Prakash…; RavikumarDu…
- **Appellants:** Bhadrashree Steel…
- **Respondents:** Ambey Iron…; Maharashtra State…
- **Advocates:** Rahul Ga…; Nikita Abh…; +1 more

## Timeline

- **2017-01-01 — CIRP Init…**: Oriental Bank of Commerce filed an application under Section 7 of the IBC against Ambey…
- **2018-03-22 — CIRP Admi…**: The Company Petition was admitted, initiating Corporate Insolvency Resolution Process…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 60(5) — Adjudicating Authority for corporate persons](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-60)

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