JAY ENGINEERING WORKS LTD. versus INDUSTRY FACILITATION COUNCIL AND ANR.

JAY ENGINEERING WORKS LTD. versus INDUSTRY FACILITATION COUNCIL AND ANR.

When an award against a sick company is included in a sanctioned rehabilitation scheme under the 1985 Act, execution of the award is barred by Section 22 unless consent of the Board is obtained; both the 1985 Act and 1993 Act operate in separate fields and neither may override the other in such context, requiring harmonious construction.

Parties
Appellant: Jay Engineering Works Ltd.; Respondent No. 1: Industry Facilitation Council; Respondent No. 2: Diamond Wire Industries, Ratlam
Jurisdiction
India
Judgment Date
14 September 2006
Procedural Posture
Civil Appeal / Supreme Court Decision on Appeal From High Court Dismissal
Outcome
Appeal allowed
Legal Topics
Sick Industrial Companies Act, Interest on Delayed Payments to Small Scale and Ancillary Industrial Undertakings Act, Interplay of Non Obstante Clauses, Execution of Arbitration Awards, Rehabilitation Schemes for Sick Companies
Corporate Insolvency Law Industrial Law Arbitration Law Sick Industrial Companies Act Interest on Delayed Payments to Small Scale and Ancillary Industrial Undertakings Act Interplay of Non Obstante Clauses Execution of Arbitration Awards Rehabilitation Schemes for Sick Companies

Case Brief

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Parties

Jay Engineering Works Ltd.

Appellant

Industry Facilitation Council

Respondent No. 1

Diamond Wire Industries, Ratlam

Respondent No. 2

Procedural Posture

Civil Appeal / Supreme Court Decision on Appeal From High Court Dismissal

Legal Issues

  1. 1 Does Section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985 bar the execution of an award passed under the Interest on Delayed Payments to Small Scale and Ancillary Industrial Undertakings Act, 1993 against a sick company?
  2. 2 Do the provisions of the 1993 Act prevail over the 1985 Act in cases of execution of awards against sick companies?
  3. 3 Is inclusion of creditors' award in a sanctioned rehabilitation scheme under the 1985 Act sufficient to invoke the bar under Section 22?

Ratio Decidendi

When an award against a sick company is included in a sanctioned rehabilitation scheme under the 1985 Act, execution of the award is barred by Section 22 unless consent of the Board is obtained; both the 1985 Act and 1993 Act operate in separate fields and neither may override the other in such context, requiring harmonious construction.

Court Disposition

Appeal allowed

Orders

  • Impugned judgments set aside
  • Respondent No. 2 is further open to approach the Board if necessary