liquidation - The Legal Chamber

The Supreme Court ruled that Regulatory Assets, while a valid regulatory tool, must be created only in exceptional circumstances and liquidated in a time-bound manner. It upheld the legal framework under the Electricity Act, 2003, and directed strict adherence to the newly inserted Rule 23 of the Electricity Rules, which mandates a maximum 3% gap in revenue and a 7-year liquidation period for existing assets. The judgment emphasizes the duty of Regulatory Commissions to ensure cost-reflective tariffs and affirms APTEL's power under Section 121 to issue directions against regulatory failure. Facts Of The Case: The case originated from petitions and appeals filed by three private power distribution companies (Discoms) in Delhi—BSES Rajdhani, BSES Yamuna, and Tata Power Delhi—agains...

This Supreme Court judgment affirms the paramountcy of the commercial wisdom of the Committee of Creditors (CoC) under the Insolvency and Bankruptcy Code, 2016. It clarifies that the moratorium under Section 14(1)(d) does not bar the return of possession of a corporate debtor's leased asset when such a decision is a conscious business choice made by the CoC and the Resolution Professional to alleviate a financial burden on the estate. Facts Of The Case: The case originated from a dispute over the possession of a property leased by Nandini Impex Private Limited, the corporate debtor. The appellants had provided loans to the company, secured by the title deeds of the property's front and rear portions. Following a default, the property was conveyed to the appellants through separate deeds ...

Tag: liquidation

Who Pays for Unpaid Power Bills? Supreme Court Explains ‘Regulatory Asset’ Mess and Orders a Fix

Supreme Court Rules Property Can Be Returned During Insolvency If Not Needed