9911796707
TMI Blog2000 (9) TMI 929X X X X Extracts X X X X X X X X Extracts X X X X ..... by the appellate authority of Industrial and Financial Reconstruction (in short AAIFR ). 2. Brief reference to the factual aspects would suffice: Petitioner had filed a reference under section 15 of the Sick Industrial Companies (Special Provisions) Act, 1985 ( the Act ) for declaring the petitioner as a sick industrial company. The reference was considered and BIFR by its order dated 4-12-1998, declared the petitioner a sick industrial unit under section 3(1)( o ) of the Act. Industrial Finance Corporation of India (in short IFCI) was appointed as the Operating Agency (OA) in terms of section 17(3) of the Act to examine the viability of company and for formulating a scheme for its revival. The company and/or its promoters were direc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt decree dated 30-8-1995 was passed on the company promising to pay Rs. 30 crores to the Bank and the Tribunal had issued a recovery certificate for Rs. 63.04 crores. Present dues were in the neighbourhood of Rs. 101 crores. Protection under section 22(1) of SICA, it was submitted, should not be allowed to be operative in respect of execution of consent decree. It was submitted that the company had let out certain premises forming part of the securities charged to the secured creditors without their permission. Stand of petitioner before the BIFR was that proposal was submitted to the OA in June, 1998 and delay was caused on account of serious illness of the CMD of the company; it was negotiating marketing tie up which was essential for fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... R. It is relevant to note that certain other directions were given with which we are not concerned. It was the stand of the petitioner before the AAIFR that efforts for revival will be frustrated if SBI proceeds with the execution of the decree: it had approached the Tribunal for modification of the consent decree and it wants to negotiate for modifications in the consent decree with the SBI. Prayer was made to stay BIFR order giving consent to SBI to proceed in the matter of recovery in terms of the consent decree. Said prayer was opposed by the SBI on the ground that the petitioner and its promoters had been giving assurances from time to time without fulfilling the same and, therefore, it has lost confidence in them. It wanted to proceed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment of at least Rs. 1 crore we directed the learned counsel for the petitioner to deposit the amount within a week when the matter came up before us, yesterday. It was adjourned to today at the request of the learned counsel for the petitioner. Today, on instructions, the learned counsel for the petitioner states that it would not be possible to do so and at least one month s time would be necessary. We find no reason to accept the prayer of petitioner to grant one month time particularly when the time asked for by petitioner before AAIFR is taken into account. Reluctance shown by the petitioner in fulfilling the conditions shows lack of seriousness. 7. Section 22(1) reads as under : "22. Suspension of legal proceedings, contracts, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... heir dues etc. The BIFR at its discretion may accord its approval for proceedings against the company. Under section 22(1) there is no absolute bar against any suit for recovery of money. The suit cannot be proceeded with except with the consent of the Board (BIFR) or the appellate authority (AAIFR). Therefore, in an appropriate case, BIFR or AAIFR, as the case may be, is entitled to give its consent to such a claim being proceeded with. ( See U.P. State Sugar Corpn. v. Sumac International Ltd. AIR 1997 SC 1644). 8. The terms contained in the consent decree passed by the Tribunal were as under: The respondent will pay a sum of Rs. 30 crores only to the applicant in the manner as under: ( i )Up-front (by 31-8-1995) of the upfront ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... extra-ordinary reliefs/concessions which were not found acceptable by secured creditors. The company was utilising the protection of section 22(1) by keeping secured creditors at bay, and was consequentially delaying process of rehabilitation. 9. These are conclusions of fact and unless they are perverse or unreasonable, there is no scope for interference under articles 226 and 227 of the Constitution. Jurisdiction under article 227 must be sparingly exercised and may be exercised to correct errors of jurisdiction and the like but not to upset pure findings of fact, which falls in the domain of the concerned Court. Tribunal or forum only ( See Khimji Vidhu v. Premier High School 2000 AIR SC 2888. Exercise of power under article 227 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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