# M/s Reliance Projects & Property Management Services Ltd v. State of U.P. & Ors. ISSUE FOR CONSIDERATION Matter pertains to

- **Citation:** (2026) 4 ILRA 413
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2026-04-24
- **Case number:** Writ C No. 32408 of 2023
- **Bench:** Ajit Kumar, Swarupama Chaturvedi
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/m-s-reliance-projects-property-management-services-ltd-v-state-of-u-p-ors-issue-54510
- **Pages:** 23

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4 All. M/s Reliance Projects & Property Management Services Ltd. Vs. State of U.P. & Ors.
413
petitioner within a period of four weeks from the date a certified copy of this judgment
is served on the Respondent-Bank.
----------
(2026) 4 ILRA 413
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 24.04.2026

BEFORE

THE HON'BLE AJIT KUMAR, J.
THE HON'BLE SWARUPAMA CHATURVEDI, J.

Writ C No. 32408 of 2023

M/s Reliance Projects & Property Management Services Ltd. ...Petitioner
Versus
State of U.P. & Ors. ...Respondents
ISSUE FOR CONSIDERATION
Matter pertains to:
(i) Whether the Insolvency and Bankruptcy Code, 2016 overrides the Electricity Act, 2003 and the Electricity
Supply Code, thereby barring the respondent authorities from raising demands relating to electricity dues for
the period prior to implementation of the Resolution Plan;
(ii) Whether the respondent authorities could raise statutory electricity dues after implementation of the
Resolution Plan despite neither filing any claim before the Resolution Professional during the Corporate
Insolvency Resolution Process nor challenging the approved Resolution Plan;
(iii) Whether, in the facts and circumstances of the case, liability of the successful Resolution Applicant
commenced from the date of approval of the Resolution Plan by the National Company Law Tribunal or from
the Effective Date of implementation of the Resolution Plan; and
(iv) Whether the impugned demand notices, recovery certificates, kurki proceedings and consequential
coercive measures relating to electricity dues for the period prior to the Effective Date were sustainable in law.
HEADNOTE
Insolvency and Bankruptcy Code, 2016 - ss.31, 238 - Electricity Act, 2003 - ss.173, 174 -
Constitution of India - Art.226 - Corporate Insolvency Resolution Process (CIRP) - Corporate
Insolvency Resolution Process (CIRP) commenced against Reliance Infratel Ltd. - Public
announcements and individual notices issued by Resolution Professional inviting claims from all
creditors, including State Electricity Distribution Companies - Respondent authorities neither
filed claims before the Resolution Professional nor challenged the approved Resolution Plan -
Resolution Plan approved by the Committee of Creditors and National Company Law Tribunal -
Implementation delayed due to pendency of appellate proceedings - Successful Resolution
Applicant taking over management on 22.12.2022 upon deposit of the entire Resolution Amount
in accordance with the approved Resolution Plan - Respondent authorities thereafter issued
demand notices, recovery certificates, kurki proceedings and disconnected electricity supply for
recovery of electricity dues relating to the period prior to the Effective Date - Petitioner
challenged recovery proceedings on the ground that all pre-resolution dues stood extinguished
under Section 31 of the Insolvency and Bankruptcy Code, 2016 and that liability could arise only
from the Effective Date - Respondents contended that the Resolution Plan became operative
414 INDIAN LAW REPORTS ALLAHABAD SERIES
from the date of its approval by the National Company Law Tribunal; that electricity dues
constituted statutory first charge under the Electricity Supply Code; and that restoration of
electricity supply could be insisted upon only after payment of past dues - Questions arose
regarding overriding effect of the Insolvency and Bankruptcy Code over the Electricity Act,
extinguishment of statutory electricity dues not submitted during CIRP, commencement of
liability of the successful Resolution Applicant, legality of recovery proceedings initiated after
implementation of the Resolution Plan, and applicability of the clean slate principle:

Held: Legal maxim, "leges posteriores priores contrarias abrogant", which means wherever two
enactments are irreconcilably inconsistent, the later enactment must prevail to the extent of
such inconsistency. This principle of interpretation of statutes is generally applicable in a
situation where two enactments appear to operate in the same field but got enacted in different
timeline. Where there is a conflict between two Statutes, the Court must first attempt a
harmonious construction, however, where such reconciliation is not possible, the later
enactment would prevail as per above-mentioned maxim.
Section 238 of the IBC contains a non obstante clause asserting the overriding effect of the Code
over all other laws in force. Section 31 of the IBC further indicates that an approved Resolution
Plan is binding on all stakeholders, including governmental and statutory authorities. The IBC is
a subsequent and comprehensive legislation intended to consolidate and amend the laws
relating to insolvency resolution and its scheme would be rendered unworkable if past liabilities,
not forming part of the Resolution Plan, were permitted to be raised by claimants relying upon
any other statute. Thus, when Section 238 of the IBC is read in light of the objective of the Code
and established legal principles, there remains no doubt that, in the event of inconsistency
between the IBC and any other statute, including sector-specific enactments such as the
Electricity Act, 2003, the provisions of the IBC would prevail.
Court further held that respondents had multiple occasions and forums to challenge the Resolution Plan
if they had any grievance, but after opting to neither file claim nor challenge the Resolution Plan,
respondents have lost the opportunity and the old claim of the corporate debtor is extinguished
in the facts of the case. The claims sought to be enforced pertained to the pre-CIRP period, CIRP
period, Monitoring Phase and further up to the Effective Date, for which no claim was filed by the
respondents. Such claims are extinguished in terms of Section 31 of the IBC as well as the express
provisions of the Resolution Plan and are not enforceable against the petitioner. The Resolution
Plan, having attained finality, is binding on all stakeholders, including statutory authorities, and
operates on a clean slate principle, and therefore the respondent authorities could not have
proceeded to raise or enforce demands which are extinguished, nor could they have resorted to
coercive measures for recovery of such extinguished claims.
Court further held that the Effective Date was 22.12.2022, being the date on which the successful
Resolution Applicant took over the management of the Corporate Debtor upon deposit of the Resolution
Amount and actual implementation of the Plan. The Court observed that the newly resolved company
cannot be forced to bear the financial burden due to such delay caused because the NCLT order
approving the Resolution Plan got challenged before appellate Courts and applied the maxim actus
curiae neminem gravabit, holding that the act of the Court shall prejudice no one. Considering the
Resolution Plan and the commercial wisdom of the Committee of Creditors, the Court concluded that the
liability arises from the Effective Date which is expressly mentioned in the Resolution Plan, and
that, in the peculiar facts and circumstances of the case, the liability shall arise from the date on which
the petitioner could effectively implement the Resolution Plan after depositing the complete
Resolution Amount. Otherwise, putting the uncertain, unexpected, unclaimed burden on the
resolved entity will be against the principles on which the insolvency law is based.
Court held that the IBC has overriding effect over the Electricity Act and related laws. Since respondents had
not filed their claims during CIRP, they cannot raise any demand, as the claim has got
extinguished after approval of the Resolution Plan. Since claims relating to the period prior to approval of
the Resolution Plan stood extinguished, the respondents were precluded from enforcing any such
claims, and the liability of the petitioner cannot be fastened prior to the Effective Date determined
4 All. M/s Reliance Projects & Property Management Services Ltd. Vs. State of U.P. & Ors.
415
in accordance with the Resolution Plan. The Court identified four phases-pre-CIRP dues, CIRP period dues,
Monitoring Period dues, and the final phase after the Effective Date-and held that dues arising in the first,
second and third phases cannot be enforced after the Resolution Plan is implemented. It is only
liabilities arising in the final phase that can be validly claimed. Consequently, the impugned
demand notices pertaining to the duration prior to CIRP, during CIRP, the Monitoring Phase and
up to the Effective Date cannot be sustained in law. The impugned Recovery Certificates and Kurki
proceedings, to the extent they related to demands prior to the Effective Date, i.e., 22.12.2022, were
set aside. The writ petition was allowed; the impugned demand notices, consequential recoveries and
actions were quashed, however, the respondent authorities were left at liberty to issue fresh
demand notices for any dues occurring after the Effective Date, i.e., 22.12.2022, in accordance
with law.
[Paras 42, 44, 47, 58, 59, 66, 69, 71, 73, 76, 78, 79, 83, 84, 85, 87 and 88]
CASE LAW CITED
Ghanshyam Mishra and Sons (P) Ltd. v. Edelweiss Asset Reconstruction Co. Ltd., (2021) 9 SCC 657;
M/s Ruchi Soya Industries Ltd. v. Union of India and Others, (2022) 6 SCC 343;
Pratap Technocrats (P) Ltd. and Others v. Monitoring Committee of Reliance Infratel Ltd. and Others, Civil
Appeal No. 676 of 2021, decided on 10.08.2021;
Tata Power Western Odisha Distribution Ltd. and Another v. Jagannath Sponge Pvt. Ltd., 2023 SCC OnLine
SC 2442;
Meghalaya Power Distribution Corporation Ltd. (MePDCL) v. M/s Reliance Infratel Ltd., 2025:MLHC:365-DB;
K.C. Ninan v. Kerala State Electricity Board, (2023) 14 SCC 431;
State Tax Officer (1) v. Rainbow Papers Ltd., (2023) 9 SCC 545;
Torrent Power Ltd. v. Ashish Arjunkumar Rathi and Others, 2026 SCC OnLine SC 325;
Innoventive Industries Ltd. v. ICICI Bank and Another, (2018) 1 SCC 407;
Paschimanchal Vidyut Vitran Nigam Ltd. v. Raman Ispat Pvt. Ltd., 2023 SCC OnLine SC 842;
State Tax Officer v. Rainbow Papers Ltd., (2023) 9 SCC 545;
Duncans Industries Ltd. v. AJ Agrochem, (2019) 9 SCC 725;
Essar Steel India Ltd. Committee of Creditors of v. Satish Kumar Gupta, (2020) 8 SCC 531 : (2020) 13 SCR
683;
RPS Infrastructure Ltd. v. Mukul Kumar (2023) 10 SCC 718;
Vaibhav Goel & anr v. Deputy Commissioner of Income-Tax & anr (2025) 8 SCC 511;
South East U.P. Power Transmission Company Ltd. v. Prescribed Authority and 4 Others, Writ-C No. 19391
of 2023, decided on 24.04.2026 (All.);
Arcelor Mittal India Pvt. Ltd. v. Satish Kumar Gupta, (2019) 2 SCC 1;
State Bank of India and Others v. Doha Bank Q.P.S.C. and Another, Civil Appeal No. 8527 of 2022.

List of Acts
Insolvency and Bankruptcy Code, 2016;
Electricity Act, 2003;
Constitution of India.
List of Keywords
Corporate Insolvency Resolution Process (CIRP); Resolution Plan; Successful Resolution Applicant; Effective
Date; Clean Slate Principle; Extinguishment of Claims; Electricity Dues; Statutory Creditors; Distribution
Licensee; Resolution Professional; Public Announcement; Operational Creditor; Monitoring Period; Pre-CIRP
Dues; CIRP Dues; Post Effective Date Liability; Recovery Certificate; Demand Notice; Electricity Disconnection;
Coercive Recovery; Section 31 IBC; Section 238 IBC; Overriding Effect of IBC; Actus Curiae Neminem
Gravabit; leges posteriores priores contrarias abrogant.
416 INDIAN LAW REPORTS ALLAHABAD SERIES
CASE ARISING FROM
Petitioner filed the writ petition challenging demand notices, recovery certificates, kurki proceedings and
disconnection of electricity supply whereby respondent distribution companies sought to recover electricity
dues pertaining to the period prior to the Effective Date under an approved Resolution Plan.
Appearances for Parties
Advs. for the Petitioner: Rahul Agarwal, Vedant Agarwal
Advs. for the Respondents: Ankit Prakash, Baleshwar Chaturvedi, C.S.C., Kartikeya Saran, Krishna
Agarawal, Mukesh Kumar Singh, Rahul Agarwal, Udit Chandra
(Delivered by Hon'ble Swarupama Chaturvedi, J.)

For the convenience of exposition, this common order is divided into the following parts:-

INDEX

I. Introduction
II. Factual Matrix
III. Submissions on behalf of Petitioner
IV. Submissions on behalf of Respondents
V. Points for Determination
VI. Discussion and Analysis

(i) Overriding Effect of the IBC over Electricity Laws

(ii) Validity of Pre-CIRP dues raised after implementation of Resolution Plan

(iii) Date of commencement of the liability

(iv) Legality of Impugned Demands and Coercive Measures..
VII. Conclusion
VIII. Order

I
Introduction

1. Present petition has been filed under Article 226 of the Constitution of India, praying for
issuance of several orders and directions in the nature of writ of certiorari and mandamus. Main
relief sought in the petition is for order or direction in the nature of certiorari quashing the
impugned Recovery Certificates and kurki proceedings issued by respondent nos.1 to 6, especially
the impugned demands to the extent they relate to alleged electricity dues for the period prior to
22.12.2022 when the resolved company was effectively commenced.

2. The petitioner further prays for issuance of the writ in the nature of mandamus commanding
the respondents to de-seal the mobile tower sites as detailed in the writ petition and to restore
electricity supply to all disconnected sites. A further direction has been prayed for requiring the
respondents to act in accordance with Section 31(1) of the Insolvency and Bankruptcy Code, 2016
4 All. M/s Reliance Projects & Property Management Services Ltd. Vs. State of U.P. & Ors.
417
(hereinafter referred to as IBC ) and the law laid down by the Supreme Court in Ghanshyam
Mishra v. Edelweiss Asset Reconstruction Co. Ltd., (2021) 9 SCC 657 and M/s Ruchi Soya
Industries Ltd. v. Union of India & Ors., (2022) 6 SCC 343.

3. The petitioner has also prayed for an order or direction in the nature of mandamus declaring
that the approved resolution plan dated 25.11.2019 is binding on all stakeholders and that no
liability survives in respect of any debts, claims or dues arising prior to 22.12.2022, including those
of statutory authorities. Consequential reliefs have been prayed for restraining the respondents from
taking any coercive steps pursuant to the impugned demands and Recovery Certificates, and for a
direction to grant new electricity connections in respect of existing and pending applications for
mobile tower sites, subject to compliance with applicable conditions.

4. Counter affidavits have been filed on behalf of contesting respondents and rejoinder
affidavits have also been filed by the petitioner. With the consent of learned counsel for the
respective parties, the writ petition was taken up for final hearing and is being disposed of by this
judgment.

II
Factual Matrix

5. The facts of the case, as emerging from the pleadings on record are that the insolvency
petition under Section 9 of the IBC was admitted against Reliance Infratel Ltd. (hereinafter referred
to as RITL ) by the National Company Law Tribunal, Mumbai (hereinafter referred to as NCLT )
vide its order dated 15.05.2018. The above mentioned NCLT order imposed the moratorium and
appointed the Interim Resolution Professional (hereinafter referred to as IRP ), as on 18.05.2018,
consequently the Corporate Insolvency Resolution Process (hereinafter referred to as CIRP ) got
commenced.

6. On 21.05.2018, the IRP made the public announcement (hereinafter referred to as the "First
Public Announcement") inviting all the creditors of RITL to submit proof of claims. Meanwhile the
NCLT order dated 15.05.2018, admitting the insolvency petition got challenged in National Law
Company Appellate Tribunal (hereinafter referred to as the NCLAT ), where the NCLT order got
stayed by an order dated 30.05.2018, but later on, the petition got withdrawn on 30.04.2019 and
consequently CIRP got re-commenced as per IBC.

7. On 07.05.2019 IRP made another public announcement (hereinafter referred to as the
"Second Public Announcement") inviting all the creditors to submit proof of claims. It is an
undisputed fact that respondent authorities have not submitted any claim before the Resolution
Professional (hereinafter referred to as RP ) during CIRP for which the impugned demand notices
are being issued. On 24.05.2019 IRP prepared the Information Memorandum and the Committee of
Creditors (hereinafter referred to as CoC ) of RITL was constituted.

8. On 21.06.2019 NCLT confirmed the appointment of RP. As per procedure prescribed under
IBC, the RP published Form G containing a detailed invitation for expression of interest
(hereinafter referred to as "EOI") to which Reliance Projects & Property Management Services Ltd.
(hereinafter referred to as RPPMSL ) responded positively. Additionally RP issued letters dated
418 INDIAN LAW REPORTS ALLAHABAD SERIES
25.07.2019 and 22.08.2019 addressed to all State Electricity Boards, Distribution Companies, and
other respondents informing them of the CIRP and calling for claims.

9. Following due procedure of the CIRP, the RPPMSL submitted its resolution plan, which got
approved by the CoC on 02.03.2020 and subsequently, NCLT approved the same resolution plan
vide its order dated 03.12.2020. The order passed by the NCLT was assailed in appeals before
NCLAT as well as Supreme Court.

10. The NCLT order approving resolution plan got assailed by some stakeholders before
NCLAT, which stayed the distribution of the total resolution amount to certain parties due to intercreditor disputes. The matter travelled upto the Supreme Court where the resolution plan got a way
to move towards its implementation.

11. The NCLT vide its order dated 21.11.2022 allowed RPPMSL's application to deposit the
Total Resolution Amount in an escrow account towards successful implementation of the
resolution plan. Thereafter on 22.12.2022, minutes of the meeting of the CoC noted that all steps of
the implementation in the resolution plan were completed.

12. Further, consequent to the order dated 11.05.2023 passed by the NCLT, Mumbai and the
order dated 07.08.2023 passed by the NCLT, Ahmedabad under Sections 230-232 of the
Companies Act, 2013, RITL stood merged into the Petitioner Company with effect from
22.12.2022. Hence, records demonstrate that pursuant to the approval of the resolution plan,
RPPMSL took over RITL on 22.12.2022, which became the effective date.

13. After complete implementation of the approved resolution plan, Respondent Nos.3 to 6
have issued recovery certificates and raised demands against RITL in respect of electricity dues
pertaining to the period prior to the effective takeover date. The Respondents also disconnected
electricity for some mobile towers while insisting upon payment of the entire amount, along with
interest and penalty, as a precondition for reconnection.

14. Aggrieved by above, petitioner company has filed this petition under Article 226,
challenging mainly the demand notices issued by the respondent authorities. Although there are
various prayers made in the petition, during hearing counsel appearing from respective parties
agreed that the main point of contest was the demand notice, to the extent that such dues relate to
the period prior to the date to commence liability i.e., 22.12.2022 and also the fact as which date
would be considered as the date to commence liability, date of approval of resolution plan by
NCLT or the date when the resolved company effectively commenced.

III
Submissions on behalf of Petitioner

15. We have heard Sri Navin Sinha, learned Senior Advocate assisted by Sri Vedant Agarwal,
Sri Madhav Kanoria and Sri Aditya Swaroop, learned counsel for the petitioner. At the outset, Sri
Sinha, learned Senior Advocate submitted that a public announcement was made by the IRP upon
commencement of the CIRP, inviting all creditors to submit their respective claims, and in addition,
4 All. M/s Reliance Projects & Property Management Services Ltd. Vs. State of U.P. & Ors.
419
RP also send letters to all the DISCOMs (licensees) informing commencement of CIRP, still no
claim was filed by the respondents during CIRP.

16. Sri Sinha had drawn the attention of the Court to the list of statutory creditors mentioned in
the resolution plan, and argued that despite such public announcement and individual letters, none
of the DISCOMs submitted any claim before the RP. He submitted that the CoC unanimously
approved the resolution plan, which came to be approved by the NCLT vide its order dated
03.12.2020. The said approval was unsuccessfully assailed before the NCLAT and further before
the Supreme Court, where the challenge culminated in dismissal of the petition in Pratap
Technocrats (P) Ltd. And Others Vs. Monitoring Committee of Reliance Infratec Ltd. And
Others, order dated 10.08.2021 in Civil Appeal No. 676 of 2021 thereby upholding the order
approving of the resolution plan.

17. It was further submitted that none of the DISCOMs ever challenged the resolution plan at
any stage by asserting their alleged claims before any forum. Sri Sinha had also submitted that on
22.12.2022, the new management took over the company in terms of the approved resolution plan
upon payment of the resolution amount into the designated account. Learned Senior Advocate
emphasized that till the above-mentioned date, no demand had been raised by any of the
DISCOMs, although, according to him, electricity supply to certain mobile towers had been
disconnected in part even prior to and during the CIRP period.

18. It was contended that it was only after the resolution plan attained finality and the new
management assumed control that the respondent DISCOMs raised demands towards electricity
charges pertaining to the period prior to the CIRP and also for the period prior to the date of
effective takeover. Sri Sinha submitted that, in view of Section 31 of the IBC, such claims, not
having been submitted before the RP, stood extinguished. In support, reliance was placed on the
judgment of the Supreme Court in Tata Power Western Odisha Distribution Ltd. and another
Vs. Jagannath Sponge Pvt. Ltd., (2023) SCC OnLine SC 2442, to contend that once a resolution
plan was approved, the successful resolution applicant could not have been burdened with past
liabilities, and permitting such claims would defeat the very scheme of the enactment. It was, thus,
submitted that the impugned demand notices and consequential recovery proceedings were liable to
be quashed.

19. Sri Sinha, however, fairly submitted that insofar as the dues arising after 22.12.2022 were
concerned, the petitioners were ready and willing to pay the same, subject to restoration of
electricity connections to enable operation of the mobile towers. He further submitted that the
liability of the petitioner, if any, would arise only from 22.12.2022, when the new management has
taken over and claimed this date to be effective date (hereinafter 22.12.2022 shall be referred to as
effective date for convenience).

20. Sri Sinha invited attention of the Court to the relevant clauses of the resolution plan, i.e.,
clause 1.2.6 and clause 4.1, as also clauses 2.1.1 and 2.1.2, submitted that an Interim Monitoring
Committee was constituted post-approval of the resolution plan by the NCLT, comprising the RP,
nominees of financial creditors and nominees of the petitioner company, for which the petitioner
had also contributed a sum of Rs. 100 crores.
420 INDIAN LAW REPORTS ALLAHABAD SERIES

21. Sri Sinha urged that upon payment of the entire resolution amount on the effective
takeover date, no liability of the erstwhile corporate debtor could survive in respect of any dues
prior thereto. He had invited the attention of the Court to the minutes of the meeting of the Interim
Monitoring Committee/ Committee of Management, particularly agenda item no. B2, to indicate
that the Effective Date has been recorded as 22.12.2022, being the date on which the resolution
amount stood deposited in the escrow account maintained with the State Bank of India. It was, thus,
submitted that the petitioner had already discharged liabilities from the said date onwards and no
prior dues, therefore, remained recoverable.

22. Sri Sinha has also placed reliance upon the letter dated 25.07.2019 issued by the
Resolution Professional, wherein it has been stated that the resolution plan would be deemed to
have become effective upon deposit of the entire resolution amount in the designated account. In
further support of his submissions, reliance has been placed upon the judgment of the Supreme
Court in Ghanshyam Mishra and Sons Pvt. Ltd. (supra), particularly paragraphs 132, 140 and 149
of the judgment, to contend that all claims not forming part of the resolution plan stand
extinguished and that the successful resolution applicant is entitled to get the company as a clean
slate.

23. It was urged that the liability, if any, would arise only from the Effective Date, i.e., the
date of transfer of control coupled with deposit of the resolution amount, and not from the date of
approval of the resolution plan by NCLT as the order continued to be under litigation, which was a
situation not under control of the petitioner. He further contended that the resolution plan was
binding upon all stakeholders and on the point as to from when the liability would have arisen, it
was clearly provided under the plan and, therefore, the demand was to be raised only after the
effective date, which was date of takeover and not the date of NCLT order in the facts of this case
considering the years long time gone under litigation due to which the resolution plan could not get
implemented.

24. On the basis of aforesaid, Sri Sinha argued that all claims, including statutory dues of the
erstwhile RITL, stood extinguished on the effective takeover date i.e., 22.12.2022. He also
submitted that the successful resolution applicant could not be burdened by uncertain past liabilities
of corporate debtor as it would defeat the object of the IBC.

25. Sri Sinha submitted that by virtue of Section 238 of the IBC, the provisions of IBC
override the Electricity Act, 2003 and any subordinate legislation framed thereunder. He argued
that the respondents, having failed to submit their claims despite due notice, were precluded from
raising the same at later stage and the petitioner had, in any case, already incurred substantial
expenditure exceeding Rs. 75 crores towards electricity dues for operational towers during the
CIRP and Interim Monitoring Committee period, and no liability can be fastened in respect of nonoperational towers or towards interest and penalty for the prior period.

26. Sri Sinha lastly submitted that the similar issue was before the division bench of the High
Court of Meghalaya at Shillong in Meghalaya Power Distribution Corporation Limited
(MePDCL) v. M/s Reliance Infratel Limited, 2025:MLHC:365-DB, regarding same resolution
plan and the High Court had restrained the authorities from raising old electricity dues pertains to
4 All. M/s Reliance Projects & Property Management Services Ltd. Vs. State of U.P. & Ors.
421
the corporate debtor while holding that all debts not included in the plan prior to the effective date
would be deemed to be extinguished.

IV
Submissions on behalf of Respondents

27. We have heard Sri Manish Goyal, learned Senior Advocate assisted by Sri Udit Chandra,
learned counsel for the respondent Power Corporation, Sri Krishna Agrawal, learned counsel for
respondent no.2, Sri Mukesh Kumar Singh, learned counsel for respondent no.4, Sri Baleshwar
Chaturvedi, learned counsel for respondent no.5, Sri Ankit Prakash, learned counsel appearing for
respondent no.6. Since submissions advanced by learned counsel appearing for contesting
respondents were similar as well as overlapping, we consider it appropriate to record it altogether,
as the issues involved are common.

28. Leading the submission on behalf of respondents, Sri Goyal, learned Senior Counsel, at the
outset fairly submitted that the legal position, insofar as extinguishment of claims not submitted
before the RP was concerned, it stood settled against respondents. He submitted that where a
creditor, including the Government or its instrumentalities, had failed to lodge its claim in the CIRP
and the resolution plan had came to be approved by the NCLT, the provisions of Section 31(1) of
the IBC would operate to extinguish such claims, and any recovery in respect thereof would not be
sustainable in law. He further submitted, in all fairness, that this position stood conclusively settled
by a catena of judgments of the Supreme Court, including the case of Ghanshyam Mishra and
Sons Pvt Ltd (supra).

29. However, Sri Goyal raised a caveat to the extent of the petitioner s contention regarding
the Effective Date. He submitted that the liability of the petitioner could not have been confined to
the date of transfer of management or deposit of the resolution amount, i.e., 22.12.2022, and
instead must relate back to the date of approval of the resolution plan by the NCLT, i.e. 03.12.2020.
Elaborating the submission, he contended that the order of the NCLT approving the resolution plan,
in unequivocal terms, stipulated that the plan shall be effective from the date of the order itself.

30. Sri Goyal referred to the relevant directions, particularly clause 8.2.1 of the plan, to submit
that the approval order clearly manifested the intention that the plan would come into force from
the date of such approval and not from any subsequent date of transfer of assets or payment.

31. Sri Goyal further submitted that the constitution of an Interim Monitoring Committee, as
referred to by the petitioner, was merely a facilitative mechanism for implementation of the
resolution plan and did not, in any manner, defer or alter the date from which the plan became
operative. He contended that, in view of the proviso to Section 31(1) of the IBC, the Adjudicating
Authority was required to satisfy itself regarding the feasibility and implementation of the plan and
may issue necessary directions for its effective execution. According to him, such directions cannot
be construed as postponing the operative date of the plan, and once the NCLT has clearly directed
that the plan shall be effective from the date of its order, no other interpretation was permissible.
422 INDIAN LAW REPORTS ALLAHABAD SERIES

32. It was further argued by Sri Goyal that any subsequent deposit of funds or procedural
steps, including transfer of money into an escrow account with the State Bank of India pursuant to
inter se disputes between financial institutions or directions issued by the Supreme Court, would
not have the effect of altering the effective date of the resolution plan. He submitted that these were
consequential steps towards implementation and cannot determine the date from which liabilities
are to be reckoned.

33. Dealing with the argument based upon the judgment in Ghanshyam Mishra and Sons Pvt.
Ltd (supra) relied upon by the petitioner, Sri Goyal submitted that the said judgment did not
address the issue as to whether the effective date of a resolution plan was the date of approval by
NCLT or the date of transfer of management. According to him, the observations therein could not
be read to draw any inference that the effective date would be the date of transfer of control, and
any such interpretation would amount to reading beyond the ratio of the judgment. He further
submitted that any directions in the said judgment relating to the date of transfer were traceable to
the powers of the Supreme Court under Article 142 of the Constitution of India and could not be
treated as a binding declaration of law on the issue.

34. Sri Ankit Prakash, learned counsel appearing for respondent no. 6, supplemented the
submissions by placing reliance upon the terms of the resolution plan itself, particularly clause
1.2.6, to contend that the plan expressly provided that it shall be effective from the date of approval
by the NCLT.

35. Respondents further contended that under clause 4.3(f)(iv) of the U.P. Electricity Supply
Code, 2005, the outstanding electricity dues constitute a first charge on the assets, and therefore,
any subsequent applicant or entity seeking reconnection was liable to clear such dues. It was urged
that by virtue of such statutory charge, the respondent DISCOMs would become secured creditors,
and such security interest, being created by operation of law, could not be extinguished under IBC.

36. It was also argued that electricity being an essential service within the meaning of Section
14(2) of the IBC, if the petitioner continued to consume electricity during the moratorium period
for maintaining the corporate debtor as a going concern, the corresponding dues would necessarily
be payable.

37. Placing reliance on the principle laid down in K.C. Ninan Vs. Kerala SPB (2023) 14 SCC
431, it was further contended that a request for restoration of electricity supply at a disconnected
premises amounts to reconnection and not a fresh connection, and therefore, the respondent
authorities are entitled to insist upon clearance of past arrears as a condition precedent for such
reconnection.

38. Lastly, reliance was placed on the doctrine emerging from State Tax Officer v. Rainbow
Papers Limited (2022) SCC online SC 1162, to contend that if a resolution plan failed to account
for statutory dues or ignored a statutory first charge created by law, the same would be legally
untenable and ought not to have been approved by the Adjudicating Authority. Accordingly, it was
submitted that the respondent authorities are within their rights to enforce recovery of such dues
and to insist upon payment as a precondition for restoration of electricity supply.
4 All. M/s Reliance Projects & Property Management Services Ltd. Vs. State of U.P. & Ors.
423
V
Points for Determination

39. Having regard to the factual matrix and the rival submissions advanced on behalf of the
parties, the following points arise for determination:

(i) Whether IBC overrides the electricity laws and regulations, thereby barring the
respondent authorities from raising demands for the pre-resolution period after the resolution plan
is duly approved and implemented.

(ii) Whether the respondent authorities could raise demand for their statutory dues after
implementation of resolution plan, while they have neither filed their claim during CIRP nor
objected to the resolution plan before NCLT.

(iii) Whether there can be any liability, which was not mentioned in the resolution plan,
can be imposed upon petitioner for the duration prior to the effective date of the implementation of
the plan, in the facts and circumstances of the case.

(iv) Whether the impugned demands, recovery certificates and consequential coercive
measures are sustainable in law.

VI
Discussion and Analysis

40. The Supreme Court has analysed the scope of the judicial review in the IBC related cases
in Torrent Power Ltd. v. Ashish Arjunkumar Rathi and Others, 2026 SCC OnLine SC 325,
where it was held that:

 14.7. Predictability and finality are thus essential to maintaining a robust insolvency
regime. Judicial intervention beyond the narrow statutory confines undermines both predictability
and finality. Recognising this, the IBC deliberately confines judicial review to strict statutory
compliance under Sections 30(2) and 61(3). Respecting these limits will preserve the economic
sense of the IBC and ensure that insolvency remains a predictable, time-bound, and market-driven
process.

41. Being conscious of the settled legal position that the scope of judicial review over an
approved resolution plan under the IBC is very limited, and that the commercial wisdom of the
CoC is not open to judicial scrutiny, especially at the stage when the resolution plan is already
implemented, we proceed to examine issues arising for determination in these petitions.

(i) Overriding Effect of the IBC over Electricity Laws.

42. The question of primacy between the IBC and the Electricity Act, 2003 arises for
consideration in the present case. Learned counsel for the petitioner has drawn attention to Section
238 of the IBC, which contains a non obstante clause asserting the overriding effect of the Code
over all other laws in force. Per contra, learned counsel appearing for the respondents have placed
reliance upon Sections 173 and 174 of the Electricity Act, 2003 to contend that the said enactment
has an overriding effect in certain circumstances. In this backdrop, it becomes necessary to
424 INDIAN LAW REPORTS ALLAHABAD SERIES
examine the scope and interplay of the aforesaid provisions to determine which Statute would
prevail in the event of inconsistency.

43. In addition to Section 238 IBC, the significant role is also being played by Section 31 of
the IBC, which indicates that an approved resolution plan is binding on all stakeholders, including
governmental and statutory authorities. Section 31 (1) of the IBC is reproduced below for easy
reference:

 31. Approval of resolution plan. (1) If the Adjudicating Authority is satisfied that the
resolution plan as approved by the committee of creditors under sub-section (4) of section 30
meets the requirements as referred to in sub-section (2) of section 30, it shall by order approve
the resolution plan which shall be binding on the corporate debtor and its employees, members,
creditors, including the Central Government, any State Government or any local authority to
whom a debt in respect of the payment of dues arising under any law for the time being in force,
such as authorities to whom statutory dues are owed.] guarantors and other stakeholders
involved in the resolution plan:

Provided that the Adjudicating Authority shall, before passing an order for approval of
resolution plan under this sub-section, satisfy that the resolution plan has provisions for its
effective implementation.
(emphasis supplied)

44. We also consider it necessary to refer legal maxim, leges posteriores priores contrarias
abrogant, which means wherever two enactments are irreconcilably inconsistent, the later
enactment must prevail to the extent of such inconsistency. This principle of interpretation of
statutes is generally applicable in a situation where two enactments appear to operate in the same
field but got enacted in different timeline. It is a settled rule of statutory interpretation is that where
there is a conflict between two Statutes, the Court must first attempt a harmonious construction,
however, where such reconciliation is not possible, the later enactment would prevail as per abovementioned maxim.

45. The IBC is a subsequent and comprehensive legislation intended to consolidate and amend
the laws relating to insolvency resolution, specifically focussing on revival of corporate debtors in a
time-bound manner. The scheme of the Code would be rendered unworkable if past liabilities, not
forming part of the resolution plan, were permitted to be raised by claimants relying upon any other
Statute.

46. For ascertaining the legislative intent underlying the enactment of the IBC, we consider it
appropriate to refer to its preamble, which was also analysed by the Supreme Court in Innovative
Industries Ltd. v. ICICI Bank & Anr., (2018) 1 SCC 407.