Tangedco has said that the National Company Law Tribunal (NCLT) is not the forum for deciding on its non-payment of dues dispute with private power producer Ind Bharath Group said.
The Ind Bharath Group has filed an insolvency petition in NCLT, Chennai, against the State’s power utility Tangedco for non-payment of dues of over ₹700 crore under the Insolvency and Bankruptcy Code, 2016.
Arguing against the plea, the State’s additional advocate-general Manishankar, who appeared for Tangedco, said that the utility was governed by The Electricity Act of 2003 and the current dispute would come under the provisions of The Electricity Act.
“The NCLT is not the right forum and the pending dues have been disputed under various legal forums,” he said adding that Tangedco being the sole distributor of power, bringing it under insolvency would have a serious impact.
Krishnan, senior counsel, Ind Bharath, noted that post the implementation of Insolvency and Bankruptcy code 2016, NCLT becomes the right forum for relief for issues like non-payment of dues.
After the hearings, the order in the case has been reserved.
This is the first time the insolvency route has been used to recover non-payment of dues from a State-owned enterprise and corporate lawyers say the proceedings in this case would be keenly watched as they would set a precedent.
