RISHABH AGRO INDUSTRIES LTD. versus P.N.B. CAPITAL SERVICES LTD.

RISHABH AGRO INDUSTRIES LTD. versus P.N.B. CAPITAL SERVICES LTD.

Section 22 of Sick Industrial Companies Act is attracted even after a winding up order if the conditions are satisfied; enquiry is deemed commenced on reference; Board of Directors retains power to approach BIFR after winding up; reference is not mala fide merely because it is made after part-payment; winding up order starts, not ends, the Company Court process.

Parties
Appellant: Rishabh Agro Industries Ltd.; Respondent: P.N.B. Capital Services Ltd.
Jurisdiction
India
Judgment Date
09 May 2000
Procedural Posture
Civil Appeal / Appeal From Order of Division Bench, Punjab & Haryana High Court
Outcome
Appeal allowed
Legal Topics
Winding Up Proceedings, Sick Industrial Companies (rehabilitation), Jurisdiction of BIFR, Stay of Proceedings Under Section 22
Corporate Law Insolvency Law Winding Up Proceedings Sick Industrial Companies (rehabilitation) Jurisdiction of BIFR Stay of Proceedings Under Section 22

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Parties

Rishabh Agro Industries Ltd.

Appellant

P.N.B. Capital Services Ltd.

Respondent

Procedural Posture

Civil Appeal / Appeal From Order of Division Bench, Punjab & Haryana High Court

Legal Issues

  1. 1 Whether Section 22 of Sick Industrial Companies (Special Provisions) Act, 1985 applies to stay winding up proceedings after order for winding up has been passed
  2. 2 Whether Board of Directors have jurisdiction to move BIFR after winding up order and appointment of liquidator
  3. 3 Whether reference to BIFR under Section 15(1) can be termed mala fide if made after making only part-payment

Ratio Decidendi

Section 22 of Sick Industrial Companies Act is attracted even after a winding up order if the conditions are satisfied; enquiry is deemed commenced on reference; Board of Directors retains power to approach BIFR after winding up; reference is not mala fide merely because it is made after part-payment; winding up order starts, not ends, the Company Court process.

Court Disposition

Appeal allowed

Orders

  • Order of High Court set aside
  • Proceedings before Company Judge to remain in abeyance till disposal of application/appeal before BIFR/AAIFR under the Sick Industrial Companies Act