Company challenged High Court order confirming BIFR's opinion to wind it up under SICA. Court noted company revived net worth and cleared secured creditors. BIFR order and asset restraint order were set aside.
The BIFR order dated 22.09.2010 confirming winding up and the subsequent order dated 08.12.2010 restricting asset disposal were set aside.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
$~C-60
..... Petitioner
Through : Mr.Abhayraj Verma and Ms.Priyanka Ghosh, Advs.
versus
..... Respondent Through : Mr.Arun Bhardwa, AAG for State of Haryana for R-1, 6 to 8
CORAM: HON'BLE MR. JUSTICE YOGESH KHANNA
YOGESH KHANNA, J.
“2.7.4 Having regard to the submissions made in the hearing today, and the background of the case as per the information on file, the Bench confirmed its earlier opinion that despite allowing adequate time and opportunity to the company/promoters and exploring other possible avenues also, it had not been possible to work out any acceptable revival scheme which could enable the company to run its networth positive within a reasonable time frame while discharging all its due financial obligations. Accordingly, the Bench observed that under the circumstances and merits of the case, there was no other option but to confirm its prima-facie opinion that it would be just, equitable and in
Co.Pet.No.509/2010 Page 1 of 4
public interest if the sick company – M/s Swet Chem Antibiotics ltd. is wound up in terms of Section 20(1) of SICA. Let this opinion be forwarded to the concerned High Court along with copies of all the orders passed by the Bench in the case from time to time, for further necessary action in accordance with law.”
“8. We are of the view that since all the municipal Taxes have been paid and the company has also paid income tax amounting to Rs. 79 lacs on its profits the company has thus shown its positive net worth, as per its latest audited balance-sheet, to the tune of Rs. 6.27 crores and all the secured creditors have been paid except those agitating through Woolen Kamgar Sanghatana, the appropriate order
Co.Pet.No.509/2010 Page 2 of 4
in the interest of justice of the company as well as the workmen sought to be represented by Woolen Kamgar Sanghatana, would be to take the company out of the purview of Sick Industrial Companies Act and secure adequate finances for satisfying the claim of the workmen in the Bombay High Court put forth by Woolen Kamgar Sanghatana. Having taken into account the aforesaid averments we are of the view that since the averments made in the application remained uncontroverter except the plea of the Woolen Kamgar Union said to be representing the workmen, the proceedings before the BIFR cannot now survive as the net worth of the company has become positive and accordingly, the orders impugned deserve to be set aside. If the creditors have been paid and further arrangements have been made to secure the interest of the workmen by the deposit of Rs. 8.41 crores and the disbursement of Rs. 3.5 crores as well as the fact that the order dated 1st March, 2007 contemplated an additional bank guarantee to be furnished in the sum of Rs. 1.5 crores, we are of the view that this would adequately protect the interest of the workmen though the claim now sought to be raised is said to be larger. However, taking into account the existing pleadings of the parties even in the Bombay High Court, we are of the view that the sums already deposited in Bombay High Court ( Rs. 8.5 crores), disbursed ( Rs. 3.5 crores) and ordered to be secured by way of bank guarantee ( Rs. 1.5 crores) by today's order would adequately protect the interest of the workmen and no further orders are called for. Even if we take the figure of Rs. 5 crores to be less than the actual claim, as contended by Ms. Singh, the sum enhanced by Rs. 1.5 crores, in addition to the deposit of Rs. 8.36 crores in our view, would sufficiently protect the interest of the workmen. Accordingly, we direct that the Cowtown Land Developers shall furnish a bank guarantee of Rs. 1.5 crores before the Prothonotary and Senior Master of the Bombay High Court in LPA No. 51/2005 with an advance copy to the learned Counsel appearing for the Woolen Kamgar Sanghtana.”
Co.Pet.No.509/2010 Page 3 of 4
YOGESH KHANNA, J
SEPTEMBER 04, 2017 VLD
Co.Pet.No.509/2010 Page 4 of 4
2 issues framed by the court
Whether the order of wound up by BIFR under SICA regarding the petitioner company required modification in light of its revived net worth and cleared debts
Whether to set aside the BIFR order confirming winding up and the subsequent order restricting disposal of assets
Colour shows how this judgement treated each authority
Seth Industries Ltd. V. AAIFRReferred¶16
Seth Industries Ltd. V. AAIFR 2007 SCC online Del 381 · Who else cites this
M/S SWET CHEM ANTIBIOTICS LTD
STATE OF HARYANA
YOGESH KHANNA
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
