JUDGMENT :

SUDHANSU JYOTI MUKHOPADHAYA, J.

In both the appeals, as common order dated 25th February, 2019 passed by the Adjudicating Authority (National Company Law Tribunal), Division Bench, Chennai, is under challenge, they were heard together and are being disposed of by this common judgment.

2. Two ‘Corporate Insolvency Resolution Processes’ were initiated one against ‘M/s. Paragon Steels (P) Ltd.’ and another against ‘M/s. SMM Steel Re-rolling Mills Private Limited’, for which Common ‘Resolution Professional’ was appointed and matters were heard together.

3. ‘M/s. Paragon Steels (P) Ltd.’ has two units namely- (i) LCN 19/3051 (Unit-1); (ii) LCN 19/4028 (Unit-2). On the other hand, ‘M/s. SMM Steel Re-Rolling Mills Private Limited’ has one unit namely- LCN 18/3255. ‘M/s. Kerala State Electricity Board’ was supplying electricity to all the aforesaid three units, which were disconnected owing to non-payment of dues during the ‘Corporate Insolvency Resolution Process’.

4. In the said common proceeding(s), on 26th October, 2018, the Adjudicating Authority after hearing the parties and on the concessions given by both the parties, directed the ‘Resolution Professional’ to deposit an amount of Rs.3.25 Crores, which is equivalent to the dues payable to ‘M/s. Kerala State Electricity Board’ for the months falling within ‘Corporate Insolvency Resolution Process’ period in Escrow Account without prejudice to the rights and contentions of either side, likewise directed ‘M/s. Kerala State Electricity Board’ to forthwith restore power.

5. Pursuant to the said order, the ‘Resolution Professional’ deposited the amount of Rs.3.25 Crores in the Escrow Account. The ‘Resolution Professional’ informed that the entire Rs. 3.25 Crores need not be paid because the payments made by him (on behalf of the ‘Corporate Debtor’) during ‘Corporate Insolvency Resolution Process’ period towards the dues payable for the period before admission shall be adjusted towards payments payable during the period of ‘Corporate Insolvency Resolution Process’. Since ‘M/s. Kerala State Electricity Board’ being the ‘Operational Creditor’, the payments inadvertently paid for the earlier period should be treated as claims required to be paid to ‘M/s. Kerala State Electricity Board’.

6. The ‘Resolution Professional’ submitted that this issue has already been given treatment in the ‘Resolution Plan’ by adjusting arrear payments made towards preadmission bills against the bills raised during ‘Corporate Insolvency Resolution Process’.

7. The Adjudicating Authority by impugned order dated 25th February, 2019 having noticed that the Electricity Board is not claiming any amount as ‘Operational Creditor’ observed since the payments already been made not to be considered as claim payable by the ‘Corporate Debtor’, therefore, there could not be any restructuring as to the money already duly paid by the ‘Corporate Debtor’.

8. It was also observed by the Adjudicating Authority that since the money already deposited in the Escrow Account being towards the bills raised during ‘Corporate Insolvency Resolution Process’ period, it shall be released to ‘M/s. Kerala State Electricity Board’. Release of money lying in Escrow Account cannot be linked to the arrears already paid by the ‘Corporate Debtor’, adjustments or set-off is applicable only when mutual obligations subsisting, here no debt is payable by ‘M/s. Kerala State Electricity Board’ to the ‘Corporate Debtor’. The Adjudicating Authority further observed that since the Escrow Account has come into existence by the order passed by this Bench, once any money has come to Escrow Account towards the bills on the condition power would be supplied on deposit of bills in the Escrow Account, the ‘Resolution professional’ is not at liberty to give treatment in the ‘Resolution Plan’ towards the money paid against the preadmission dues. The application was disposed of.

9. The Appellants-‘Asset Reconstruction Company (India) Limited’ and Mr. R