9911796707
TMI Blog2001 (7) TMI 1269X X X X Extracts X X X X X X X X Extracts X X X X ..... 3, 1990, the petitioner applied to the State Government for the grant of exemption from payment of sales tax. On June 3, 1992, eligibility and the exemption certificates were issued. Copies of the two certificates have been produced as annexures P.4 and P.5 with the writ petition. 3.. The petitioner alleges that it suffered huge losses. It filed a petition under section 15(1) of the Sick Industrial Companies (Special Provisions) Act, 1985 (in short "SICA"). On July 21, 1995, the petitioner was declared a sick company. An operating agency to prepare a rehabilitation scheme was appointed. On August 27, 1998, the petitioner was given a notice to show cause as to why the Board should not order the company to be wound-up. On December 15, 1998 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion. It alleges that the order is perverse and legally unsustainable. In view of the provisions of section 446 of the Companies Act, 1956, no proceedings can be commenced or continued without the leave of the court. The BIFR having ordered the winding up of the company, the orders for cancellation of exemption certificate or the recovery of the dues could not have been passed. The rule that imposes the condition regarding continuance of production, viz., 28A(11)(a)(i) is ultra vires articles 14 and 19 of the Constitution. On these premises, the petitioner prays that the rule be declared unconstitutional and the impugned order, a copy of which has been produced as annexure P.10 with the writ petition, be quashed. 6.. A written statement h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ner was controverted by Ms. Palika Monga, Additional Advocate-General, Haryana, for the respondents. She submitted that the petitioner was given the opportunity to show cause against the impugned order. It had failed to satisfy the authority that the loss of production was due to reasons beyond its control. Resultantly, the impugned order had been passed in accordance with law. She further pointed out that the petitioner has an effective alternative remedy of appeal and revision, etc., under the provisions of chapter VII of the Act. If the petitioner has any grievance, it should have resorted to those remedies. She also submitted that the petitioner itself was not serious in the rehabilitation of the unit. The BIFR had noticed the fact that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he preceding five year; and (ii) shall not make sales outside the State for next five years by way of transfer or consignment of goods manufactured by it. (b) In case the unit violates any of the conditions laid down in clause (a), it shall be liable to make, in addition to the full amount of tax-benefit availed of by it during the period of exemption/deferment, payment of interest chargeable under the Act as if no tax exemption/deferment was ever available to it: Provided that the provisions of this clause shall not come into play if the loss in production is explained to the satisfaction of the Deputy Excise and Taxation Commissioner concerned as being due to the reasons beyond the control of the units: Provided further that a u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erved by the BIFR, sold the assets, moveable as well as immovable, on its own. It had not deposited the sale proceeds with the concerned authorities. Still further, nothing seems to have been pointed out to the authority to show that the production had gone down for reasons beyond the control of the company. It is, thus, clear that the petitioner has to thank itself for the impasse in which it finds itself. It cannot blame the rule or the respondents. The first question is, accordingly, answered against the petitioner. It is held that the provision has requisite safeguards. It is not arbitrary or violative of article 14. 13.. Reg: (ii) The record indicates that the petitioner has allegedly not abided by the conditions laid down in t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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