Companies or juristic entities cannot be punished for contempt; specific individuals must be named for compliance responsibilities.

ORDER

1. The present application has been filed by Mr. Pankaj Dhanuka, Resolution Professional of Lanco Kondapalli Power Limited (hereinafter referred to as “the Applicant”), under Section 12 of the Contempt of Courts Act, 1971 , read with Section 60 (5) of the Insolvency and Bankruptcy Code, 2016 , Section 425 of the Companies Act, 2013 , and Rule 11 of the National Company Law Tribunal Rules, 2016, against the Southern Power Distribution Company of Andhra Pradesh Limited and Eastern Power Distribution Company of Andhra Pradesh Limited (hereinafter referred to as “the Respondents/DISCOMS”), seeking the following reliefs:

(i) Initiate contempt proceedings against Respondent Nos. 1 and 2 as contemplated under Section 425 of the Companies Act, 2013 .

(ii) Direct Respondent Nos. 1 and 2 to comply with the directions of this Hon’ble Tribunal given vide order dated 27.11.2019.

2. Application

2.1 The present Application has been filed by Mr. Pankaj Dhanuka, Resolution Professional of Lanco Kondapalli Power Limited (“Corporate Debtor”), seeking initiation of contempt proceedings and issuance of directions for compliance with the order dated 27.11.2019 passed by this Tribunal.

2.2 By the aforesaid order, this Tribunal directed the Southern and Eastern Power Distribution Companies of Andhra Pradesh (“DISCOMs”) to release payments towards the Corporate Debtor’s power-purchase bills on an actual-consumption basis, so as to avoid disruption to the CIRP. However, the DISCOMs have failed to fully comply with the said directions, and an amount of Rs. 16.46 crore, pertaining to the invoice dated 11.07.2019, continues to remain outstanding.

2.3 The CIRP of the Corporate Debtor commenced on 23.04.2019 (“Admission Order”), wherein the Applicant was appointed as the Interim Resolution Professional and was subsequently confirmed as the Resolution Professional on 08.07.2019.

2.4 The Corporate Debtor operates an independent power plant at Kondapalli, Andhra Pradesh, where natural gas was supplied by GAIL (India) Ltd. under a Gas Supply Agreement dated 18.12.2015. The electricity generated at the plant is supplied to the DISCOMs under a Power Purchase Agreement dated 28.04.2017 (“PPA”), which is pending approval before APERC. Under the GSA, the Corporate Debtor was obligated to make timely payments to GAIL; however, due to non-receipt of payments from the DISCOMs, it was unable to do so, resulting in the termination of gas supply by GAIL on 04.07.2019.

2.5 The Resolution Professional filed I.A. No. 637/2019 seeking payment of Rs. 28.81 crore from the DISCOMs towards the invoice dated 11.06.2019, calculated at Rs. 3.29/kWh. The said Application was disposed of on 05.09.2019 upon confirmation of payment. Thereafter, the Applicant filed I.A. No. 740/2019 seeking payment of Rs. 23.91 crore towards the invoice dated 11.07.2019 and for all future dues relating to power supply, which Application was reserved for orders on 25.09.2019. Due to the DISCOMs’ continued non-payment, the Corporate Debtor was unable to meet its payment obligations to GAIL, resulting in suspension of gas supply and stoppage of Phase-I operations for approximately three months. Operations resumed only on 05.10.2019 after clearance of the pending dues.

2.6 The Applicant submits that the DISCOMs have willfully failed to comply with the order dated 27.11.2019 passed in I.A. No. 740/2019, whereby they were directed to release payments towards the Corporate Debtor’s power- purchase bills on an actual-usage basis. Despite the issuance of a reminder letter dated 16.12.2019, the DISCOMs have neither released the payment nor furnished any response. Their continued non-payment has impeded timely payments to GAIL, resulted