The Superintending Engineer vs Parikh Fabrics Pvt. Ltd

THE SUPERINTENDING ENGINEER Operations- Nellore Circle, Southern Power Distribution Company of A.P. Ltd., (APSPDCL), Nellore - 524001 Eamil: aao_ht@apspdcl.in ...Appellant Sreebj1975@gmail.com

Versus SHRI SIVARAMA PRASAD BHAMIDI

Liquidator, M/s. Parikh Fabrics Pvt. Ltd. # Flat No. 106, Sri Krishna Ambhas Apartments, Sri Laxminagar Colony, Attapur, Hyderabad - 500 048 Email: parikhfabric.cirp@gmail.com ...Respondent Bsprasad9@gmail.om

Present: For Appellant : Mr. B Dhanaraj, Advocate

For Respondent : Mr. E Om Praskash, Sr. Adv For Mr. Imayavaramban

ORDER

Per: Justice Rakesh Kumar Jain:

This appeal is directed against the order dated 31.01.2023 passed by the

Adjudicating Authority (National Company Law Tribunal, Hyderabad Bench)

allowing the application I.A (IBC)/643/2021 filed by the Liquidator for refund of

security deposit of Rs. 32,24,100/-.

2. The brief facts of this case are that Corporate Insolvency Resolution

Process was initiated against M/s Parikh Fabrics Pvt. Ltd. (Corporate Debtor) in

CP (IB) No. 12/10/HDB/2019 by the Adjudicating Authority on 08.02.2019.

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3. The Resolution Professional (Respondent) of the Corporate Debtor filed a

miscellaneous application i.e. I.A. No. 988 of 2019 under Section 33(2) of the

Code for liquidation of the Corporate Debtor which was allowed by the

Adjudicating Authority on 21.01.2020.

4. As per the Appellant, it provided electricity connection of 300 KVA under

High Tension (HT) Cat-3 to the Corporate Debtor in terms of power supply

agreement dated 13.04.2010, the load of the service connection was increased to

750 KVA on 25.07.2011 and later derated to 450 KVA on 27.11.2014. However,

it is alleged that on 26.03.2016, the load was further increased to 650 KVA upon

the Corporate Debtor's request but on 14.11.2019, the Corporate Debtor

requested deration from 650 to 260 KVA, which was approved by the Appellant.

However, it is alleged that the Corporate Debtor failed to pay the cost of

estimation of amount of Rs. 6,480/- and had not arranged for a revised HT

Agreement, therefore, the deration request was not considered.

5. It is further alleged by the Appellant that during the execution of the Power

Supply Agreement dated 13.04.2010, the Corporate Debtor deposited a security

deposit of Rs. 4,50,000/- and subsequently, additional renewal agreements were

executed, increasing the total security deposit of Rs. 32,24,100/-. It is also alleged

that electricity connection was disconnected on 13.01.2020 due to non-payment

of CC charges. According to the Appellant, the Corporate Debtor requested on

20.01.2020 to adjust the dues from the refundable deposit of Rs. 32,24,100/- and

Company Appeal (AT) (Ins) No. 104 of 2023 3

accordingly, the superintending engineer addressed a letter on 11.02.2020

proposing the adjustment of excess security deposit towards the consumption

charges.

6. On the other hand, the case set up by the Respondent is that during the

CIRP when the production became very low due to lack of orders, the RP

requested the Appellant for deration of power supply from 650 to 260 KVA on

14.11.2019 and on 13.01.2020 the Appellant stopped power supply due to non-

payment of power charges from December, 2019. On 20.01.2020 request was

made for permanent disconnection of HT power and restoring three phase power

connection for utilities and lighting for security staff. It is further alleged that

upon receipt of liquidation orders from the Adjudicating Authority passed on

21.01.2020 and after public announcement on 25.01.2020, intimation was given

to all statutory authorities including the Appellant for submission of their claim

but no claim was received from the Appellant till date. The Respondent sought

refund of the deposit with interest from the Appellant to which they filed a

response and in the absence of any positive result, the application was filed before

the Adjudicating Authority for seeking refund.

7. The Adjudicating Authority, while allowing the application, found that the

adjustment was done while the moratorium was in operation and directed to

refund the security deposit of Rs. 32,24,100/- and no order was passed regarding

the claim of interest by the liquidator on the ground that since there was no

Company Appeal (AT) (Ins) No. 104 of 2023 4

agreement between the parties regarding payment of interest, therefore, the same

could not have been granted. It is also stated by the liquidator before the

Adjudicating Authority that though no assets of the Corporate Debtor is left with

him but if the Appellant so chooses may still make a claim to him for the arrears

due from the Corporate Debtor.

8. Counsel for the Appellant has argued that the amount of security deposit

has been adjusted against the arrears on the request made by the IRP on

20.01.2020. Whereas Counsel for the Respondent has submitted that on the next

date i.e. 21.01.2020 the liquidation order was passed and the adjustment has been

made by the Appellant on 24.07.2020, during the pendency of the liquidation

proceedings.

9. We have heard Counsel for the parties and examined the available record

from which we have found that firstly the Appellant did not file any claim and

secondly, it did not choose to appear to contest the application. After the

liquidation order was passed on 21.01.2020, all tangible or intangible, movable

or immovable properties as evidenced in balance sheet of the Corporate Debtor,

being a part of the liquidation estate in terms of Section 36(3) of the Code, could

not have been utilised by the Appellant by invoking general terms of supply of

electricity. The electricity bills incurred by CD during the moratorium period

were paid and the Appellant after the commencement of liquidation unilaterally

adjusted the outstanding bills.

Company Appeal (AT) (Ins) No. 104 of 2023 5

10. Thus, keeping in view the aforesaid facts and circumstances, we do not

find any merit in the present appeal and the same is hereby dismissed. No costs.

[Justice Rakesh Kumar Jain] Member (Judicial)

[Shreesha Merla] Member (Technical)

New Delhi 02nd August, 2023

Sheetal

Company Appeal (AT) (Ins) No. 104 of 2023