9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2012 (6) TMI 4 - HC - Companies LawApplication for dismissal of the Reference - Company took loan unable to pay its debts B.I.F.R. recommended winding up - When an Appeal was filed before the A.I.F.R. there were two schemes accepted by A.A.I.F.R. Those schemes contemplated merger of the respondent No. 1 company with the respondent No. 2 company Wanbury Limited - proceedings were taken up in this court for merger of these two companies - Supreme Court of India set aside the order passed by the B.I.F.R. and A.A.I.F.R. under Sick Companies Act sanctioning the schemes. The Court also set aside the order of this Court approving the merger of the two companies Held that - in view of the order of the Supreme Court, the respondent No. 2 was under a duty to take steps under the Companies Act to give effect to the judgment of the Supreme Court of India. scheme has been submitted by the implementing agency in the Application or Reference and that Reference is filed by the respondent No. 1. If that Reference is incompetent on the ground that respondent No. 1 is not in existence then there is no question of the B.I.F.R. having any power to consider the scheme submitted by I.D.B.I. The B.I.F.R. will get the jurisdiction to consider any scheme only if there a Reference validly made before it and pending. If the Reference is itself not validly filed or does not continue to be validly filed, it would not have the jurisdiction to entertain the scheme filed in that Reference. it has not considered the relevant material and has not given reasons for rejecting the Application filed by the Petitioner. order impugned in the Appeal passed by B.I.F.R. is set aside. The proceedings are remitted back to the B.I.F.R. It is directed to re-consider the Application filed by the Petitioner
Issues:
Challenge to order passed by B.I.F.R., validity of reference filed by respondent No. 1, refusal by respondent No. 2 to implement Supreme Court judgment, rejection of application by B.I.F.R., consideration of relevant material by B.I.F.R., jurisdiction of B.I.F.R. to entertain scheme. Analysis: The judgment by the High Court of Bombay involves a challenge to an order passed by the B.I.F.R. regarding a company registered under the Indian Companies Act that had taken a loan from Tata Finance Limited. The company was unable to pay its debts, leading to an application under the Sick Industrial Companies (Special Provisions) Act, 1985. The Supreme Court set aside orders sanctioning schemes and the merger of two companies, directing the matter to be remitted to the B.I.F.R. The petitioner, a creditor, filed an application before the B.I.F.R. for rejection of the reference, arguing that the respondent No. 1 was practically non-existent due to non-implementation of the Supreme Court's order. The B.I.F.R. rejected the application, but the High Court found that the B.I.F.R. failed to consider the Supreme Court's judgment and the respondent No. 2's refusal to implement it, emphasizing the necessity for a thorough review of all relevant material. The High Court noted that the B.I.F.R. did not assess the respondent No. 2's stance in its balance sheet regarding the Supreme Court's order, which indicated a maintenance of the status quo. The court highlighted the respondent No. 2's duty to comply with the Supreme Court's judgment and questioned the B.I.F.R.'s failure to address the legal implications of the respondent No. 2's non-compliance. It was emphasized that the B.I.F.R. should have evaluated the validity of the reference and the jurisdiction to entertain schemes in the absence of a valid reference. The High Court concluded that the B.I.F.R. had not adequately considered the relevant material and lacked reasons for rejecting the petitioner's application, leading to the order being set aside and the proceedings remitted back to the B.I.F.R. for reconsideration in accordance with the law. In summary, the judgment delves into the intricacies of company law, the implications of Supreme Court decisions on lower tribunals, and the necessity for thorough consideration of all relevant factors in legal proceedings. The High Court's analysis underscores the importance of adherence to legal principles and the proper application of law in resolving disputes related to company matters and insolvency proceedings.
|
