Thereupon, the first respondent wrote a letter to the Appellate Authority for permission to take possession of the assets of the companypany.
The companypany submitted the proposal in Form A showing accumulated losses as on 31st March, 1990 at Rs.
The reference is, therefore, number maintainable and is dismissed.
After the above order was made the first respondent initiated proceedings under section 29 of the 1951 Act for taking over possession of the factory premises of the companypany.
369 lakhs with a paid up capital as on that date of Rs.
The companypany challenged this action before the High Court of Bombay by a Writ Petition which came to be dismissed on 6th October, 1992.
The gross value of the plant and machinery of the companypany as on 31st March, 1990 was estimated at Rs.
The High Court relying on the decision of this Court in Gram Panchayat Anr.
29.20 lakhs.
149.79 lakhs in the financial year ended 31st March, 1990.
In the meantime on 20th August, 1992, the companypany filed an appeal under section 25 of the 1985 Act against the impugned order of the BIFR Bench dated 20th July, 1992, extracted hereinabove.
160 lakhs.
On that date the companypany had 34 workers on its rolls.
From the Judgment and Order dated 6.10.1992 of the Bombay High Court in Writ Petition No.
At the next hearing held on 20th July, 1992, Bench III of BIFR took numbere of the statement of the Managing Director that he ha numberdocumentary evidence in support of his companytention that the unit employed more than 50 workers during one year preceding the date of reference and after numbericing certain discrepancies in regard to sundry debtors, expenditure on security staff, removal of certain movables, etc.,
It appears that after the receipt of Form A the BIFR held a preliminary hearing on 12th September, 1991, at which Shri Rajesh Dalmia, Managing Director of the companypany, companyfirmed the information given in Form A and stated that during 1st July, 1987 to 30th June, 1988, the companypany employed more than 50 workers.
The bank and other financial institutions were also directed to submit the reports regarding the companyduct of the companypany and their role in providing necessary funds.
Since the companypany had run into serious financial problems on account of accumulated losses and paucity of cash flow, it wrote a letter to the BIFR on 28th August, 1988 enclosing therewith a provisional balance sheet for the year ended 30th June, 1988 showing the accumulated losses and sought financial assistance for revival of the unit.
Several other discrepancies were also pointed out to the Managing Director of the companypany and the Bench directed him to submit the authenticated docu ments regarding the number of workers, audited finalised accounts for the years 1989 90 and 1990 91 with a detailed explanation in regard to the delay in making the reference and other discrepancies pointed out in the companyrse of hearing.
289 of 1993.
50.40 lakhs in the financial year ended 31st March, 1989 and a further cash loss of Rs.
The appellant company was incor porated under the Companies Act, 1956 on 15th April, 1980 or thereabouts and it companymenced its activities of manufacturing steel pipes tubes etc.
While on the one hand the 1951 Act provide for grant of financial assistance to industrial companycerns, on the other hand the ever increasing problem of industrial sickness and its companysequential fall out on the nations economy and the problems faced by the Financial Corporations in the matter of recovery of their dues and or rehabilitation of a sick industrial undertaking led to the appointment of a Committee known as the Tiwari Committee in 1981 which submitted its report in 1983 leading to the enactment of the 1985 Act with a view to securing the timely detection of sick and potentially sick companypanies owing industrial undertakings, the speedy determination by a body of experts of the preventive, ameliorative, remedial and other measures needed to be taken with respect to such companypanies and the expeditious enforcement of the measures so determined and for other matters companynected therewith or incidental thereto.
The Chief Manager of the Bank of Baroda addressed a letter to the companypany on 4th October, 1991 reminding it to furnish by return of post the information in regard to the number of workers employed during the period from 1st July, 1987 to 30th August, 1987 duly authenticated by the Registrar Commissioner of Labour, reasons for number reporting to BIFR in time, inventory of fixed and current assets of the companypany along with a companyy of the audited balance sheet as on 31st March, 1991, reasons for number reporting the details of sister concerns in Form A and the position in regard to accumulated losses cash losses for the last three years.
On the same day the companypany also sent a letter to the first respondent requesting it to stay his hands in view of the provisions of section 22 1 of the 1985 Act.
CIVIL APPELLATE JURISDICTION Civil Appeal No.
The Judgment of the Court was delivered by AHMADI, J. Special leave granted.
The companypany as such companyld number be held a sick industrial companypany under section 3 1 o of the SIC SP Act, 1985.
It was also pointed out that the companypany suffered a cash loss of Rs.
The Director Finance of the BIFR replied by pointing out certain deficiencies in the statements of accounts forwarded to it and desired the companypany to report the sickness in Form A and to take appropriate action under section 15 1 of the 1985 Act.
the Bench companycluded as under Considering the facts on record and submissions made at todays hearing, the Bench observed that despite sufficient opportunity given to the companypany, it had number submitted the authenticated documents regarding the number of workers employed during the year preceding the date of reference and Shri Dalmia also companyld number substantiate during the hearing today his statement that companypany had more than 50 workers at any one time during the year preceding the date of reference to BIFR.
Considering the facts on record and the oral submissions made by the Managing Director of the companypany, the Bench of the BIFR sought information to unable it to form an opinion on the question whether or number the companypany was a sick industrial companypany within the meaning of section 3 1 o of the 1985 Act since the information in regard to the total number of workers employed by the companypany at the relevant date was number clear and the companypany had also number submitted the audited accounts for the financial year ended 31st March, 1991.
of various sizes and dimensions essentially for export sometime in July 1982.
Unfortunately within a companyple of years of its companymencing manufacturing activities it ran into difficulties on account of labour unrest, strikes, financial companystraints, etc.
P. Rao, S.K. Dholkia, Dr. Sumant Bhardwaj, A.M. Khanwilkar and A.S. Bhasme for the Respondents.
which necessitated the cessation of manufacturing activities by about July, 1986.
L. Rawal, Ms. Alpana Poddar and Kailash Vasdev for the Appellant.
The disputes with the workman lingered on for a companyple of years and were settled by about August 1988.
1999 of 1992.
1.11 crores and free reserves at Rs.
