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Issues: Company petition for winding up under section 433(e) of Companies Act, applicability of section 22 of SICA, delay in BIFR proceedings, directive for expeditious disposal by BIFR.
In the judgment, the court dealt with a company petition filed by a nationalized bank as a creditor seeking winding up of the respondent-company under section 433(e) of the Companies Act due to the respondent's inability to pay the debt. The court noted that proceedings before the BIFR under sections 15 and 16 of SICA were pending at the instance of the respondent. The court held that the bar contained under section 22 of SICA applied, preventing the winding up proceedings. The court advised the petitioner to participate in the BIFR proceedings as a creditor and wait for the outcome. If the reference is decided against the respondent, the petitioner could file a winding-up petition in court or execute a money decree obtained in the meantime. If the BIFR decides in favor of the respondent, the petitioner could seek protection of their dues with BIFR's assistance or participate in winding up proceedings if recommended by BIFR. Furthermore, the court emphasized the need for expeditious disposal of cases before the BIFR, as delays benefit the debtor company and harm the creditors. The court expressed concern over the prolonged pendency of the reference case before the BIFR, highlighting the lack of progress and the resulting stalemate. The court directed the BIFR to ensure the expeditious disposal of the pending reference case within one year from the date of the court's order, emphasizing the importance of timely resolution for both creditors and debtors to know their fate and recover outstanding dues. The court stressed that the continued stalemate was detrimental to all parties involved and urged the BIFR to fulfill its legal obligation to facilitate prompt resolution of cases.
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