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TMI Blog2001 (7) TMI 1214X X X X Extracts X X X X X X X X Extracts X X X X ..... ions of the Sick Industrial Companies (Special Provisions) Act, 1985 ('SICA'). The BIFR vide proceedings dated 24-9-1991 sanctioned a scheme for revival of the petitioner-company. The said scheme was under implementation. But on account of imposition of total prohibition in the State of Andhra Pradesh, the petitioner-company had to wind up its commercial activities from January 1995 resulting in total collapse of the implementation of the scheme as approved by the second respondent BIFR. However, after partial lifting of the prohibition, the Commissioner of Excise renewed the licence under the provisions of the A.P. Excise Act, 1968 in June, 2000 pursuant to the directions of this court obtained by the petitioner-company. 3. It is the case of the petitioner-company that the management of the petitioner-company sorted out all the pending issues including the one subsisting against the employee. It had worked out and arrived a tie-up with UB group and has been working to its maximum capacity, ever since revival. There are about 400 employees working in the unit. The long pending issue of Dena Bank has also been settled with Dena Bank, by offering one time settlement offer of the ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 15-5-2001 after evaluating the relative merits of the offers received pursuant to the advertisement issued by the OA. The Second respondent-BIFR observed that if no concrete rehabilitation proposal with means of finance fully tiedup is received pursuant to the advertisement to be issued by the OA, the Board may consider passing further appropriate orders which may include issue of a show-cause notice for winding up of the company. 6. The petitioner-company challenged the said order before the first respondent-AAIFR. The appellate authority after an elaborate consi-deration of the matter concurred with the conclusions of the second respondent-BIFR and, accordingly, dismissed the appeal. Hence, this writ petition. Before we proceed to consider the rival contentions, it is expedient to first notice the scope of judicial review by this court in exercise of its jurisdiction under article 226 of the Constitution in the matter of reviewing the orders of BIFR. 7. Re-appreciation of evidence by this court is totally impermissible. This court may have to judicially review the decision or the order as the case may be within the certiorari parameters. The court would interfere only if it f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ioner-company. According to the third respondent, petitioner No. 2 and his associates (Aggarwal Group) had entered into an arrangement with the third respondent and its associates for acquisition of the entire equity holding of Deccan Holding (P.) Ltd., Deccan Securities (P.) Ltd., Chamunda Investment (P.) Ltd., and Yogeswar Investment (P.) Ltd., (as Deccan Group) which held 100 per cent shareholding of petitioner No. 1 from the Aggarwal Group for a consideration of Rs. 1.40 crores. Thereafter, the board of directors of the said Deccan Group of Companies was restructured and the former directors of the Deccan Group (petitioner No. 2 and his nominees) resigned from the Board. Consequent upon the purchase of these Deccan Group of Companies and since they controlled the 100 per cent shares of petitioner No. 1, the original share certificates of the company were handed over and continued to remain under the control of the third respondent. The board of directors of the first petitioner-company was reconstituted on 26-12-1992. 12. The Aggarwal Group denied and disputed the sale of the shares of the Deccan Group of Companies and as well as the validity of the meeting held on 26-12-1992. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te any third party rights in respect of the property of Vinedale nor transfer the shares or create any encumbrance without the sanction of the High Court. 14. It is required to notice that the suits by and between the parties pending on the file of the Delhi High Court have nothing to do with the proceedings on the file of the BIFR. Neither the proceedings nor the orders passed by the Delhi High Court would in any manner effect the jurisdiction of the BIFR under the provisions of SICA to pass appropriate orders under section 18 of SICA. In the order itself, the Delhi High Court made it absolutely clear that the court would entitle to issue directions to the Receiver for implementing the scheme/orders of BIFR/AAIFR and further observed that the court does not intend to do anything, which will conflict with the powers of the BIFR/AAIFR. 15. It is thus absolutely clear that the order passed by the Delhi High Court in no manner would effect the jurisdiction of the BIFR to pass appropriate orders under section 18. In fact, the order appointing the Aggarwal Group as Court Commissioner itself was subject to requisite sanction from the BIFR. 16. The Aggarwal Group cannot be considered t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ition in the State of Andhra Pradesh. The industry was revived. The management of the company sorted out all the pending issues including the one subsisting against its own employees. The management had worked out and arrived a tie-up with UB group and has been working to its maximum capacity ever since its revival. 400 employees continue to work in the unit. Long pending issue of Dena Bank has also been settled by offering one time settlement. The industrial unit which is situated in 64 acres of land has been rejuvenated and has been functioning to its brim. It is also submitted that the unsecured creditors gave their consent to convert their unsecured loans to a tune of Rs. 6.39 crores into preference shares and accordingly the net worth of the company has turned out to be positive obliterating the sickness of the company. The company ceased to be a sick company. 19. It is required to notice that the said unsecured creditors are not impleaded as parties in this writ petition. However, the attempt of issuing preference shares to the unsecured creditors could not be implemented as the extraordinary general meeting called by the Aggarwal Group was stayed by the Delhi High Court vid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the matter while reviewing the sanctioned scheme. The Board heard the matter elaborately on 19-1-2001. Elaborate submissions were made and the minutes were accordingly recorded reflecting the submissions. 24. The Board noticed that the sanctioned scheme was implemented only partially as Dena Bank did not release the assistance of Rs. 2.66 crores as part of the means of finance to meet the cost of the sanctioned rehabilitation scheme. The revised proposal submitted by the company on 16-2-1998 was also taken into consideration. The BIFR observed that a joint meeting was held on 9-2-1999 when the Dena Bank refused to increase its exposure and grant term loan/working capital; likewise the Commercial Tax Department refused to reschedule the arrears of sales tax dues. The Board noticed that the accumulated losses were Rs. 552 lakhs as against the projected level of Rs. 79 lakhs. It is under those circumstances, the Board came to the conclusion that the company/promoters have failed to revive the company under the sanctioned scheme of 1991 and the proposal submitted has not been tied up by them. It is under those circumstances, the impugned order has been passed. 25. The appellate a ..... 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