STATE BANK OF INDIA Vs. ENGG MAJDOOR SANGH

JUDGEMENT

(1.) In all these applications the applicants have prayed for review of this Court's order dated 23-9-1997 passed by this Court (Coram: Hon'ble Mr. Justice S. D. Dave) in Company Petition No. 224 of 1996 sanctioning the scheme presented by Engineering Majdoor Sangh, Baroda, under Secs. 391 and 394 of the Companies Act, 1956 (hereinafter referred to as 'the Act'). Since these applications involve common question of law and fact, they are heard together and common judgment is being delivered in all these four applications

(2.) It may be clarified at the outset that in Company Application Nos. 513 of 1997, 515 of 1997 and 516 of 1997 the applicants have prayed for the following main reliefs. (i) This Court may review, quash and set aside the order dated 23-9-1997 sanctioning the Scheme of Compromise and/or arrangement proposed by the Engineering Majdoor Sangh. (ii) This Court may direct appropriate action to be initiated against Shri K.W.Desai of Engineering Majdoor Sangh for making false statements on affidavit, concealing material facts, practising fraud on the Court and misleading this Court. For the present, this Court is only dealing with the first prayer and the parties shall be at liberty to make appropriate submissions regarding the second prayer at the time of next hearing. It is necessary to make this segregation because the Company in question being Beclawat of India Ltd. was ordered to be wound up as far back as on 22-12-1992 and the properties of the Company were taken over by the Official Liquidator attached to this Court. However, by virtue of the order sought to be reviewed (i.e., the order dated 23-9-1997) possession of the properties of the Company was taken over by the Engineering Majdoor Sangh (hereinafter referred to as 'the Union'). After the Court passed order dated 23-9-1997, by order dated 23-10-1997 the Court recorded the statement made by the learned Counsel for Engineering Majdoor Sangh that they would restore back the possession and custody of the land, building and machinery of the unit in question to the Official Liquidator by 24-10-1997. Thus, though the possession and custody of the assets of the unit in question is with the Official Liquidator, the stalemate has continued for the last two years as neither the creditors nor any other parties are in a position to present any scheme under Sec. 391 and Sec. 394 of the Act nor is the Official Liquidator in a position to dispose of the assets of the Company with the result that neither the creditors nor workers are in a position to get their dues or even part thereof. For this reason, at the request of Mr. K. W. Desai, this Court has deferred consideration of the second question whether any action is required to be taken against Mr. K.W.Desai of the Engineering Majdoor Sangh, Baroda, so that any delay in deciding the said question does not prolong the stalemate existing for the last two years

(3.) Before dealing with the contentions raised in these applications, a few facts leading to filing of these applications may be stated.