JAGADEESWARAN TEXTILES LIMITED, REP BY ITS MANAGING DIRECTOR, P GOVINDASAMY THUNGAVI Vs. APPELLATE AUTHORITY FOR INDUSTRIAL AND FINANCIAL RECONSTRUCTION

JUDGEMENT

(1.) The appeal is against the interim order rejecting the stay. In that, the petitioner / appellant had sought the stay of the order of the Appellate Authority for Industrial and Financial Reconstruction (AIFR). The AIFR had confirmed the order of the Board for Industrial & Financial Reconstruction (BIFR). The BIFR has held after eight years of deliberation before it that the appellant company could not be revived and there could not be any such exercise and it decided to recommend its winding up under section 20(1) of the Sick Industrial Companies (Special Provisions) Act, 1985 (hereinafter referred to as "the Act"). That was appealed against by the appellant before the AIFR and the AIFR also confirmed the findings.

(2.) It is very fairly stated by the learned counsel for the appellant that in pursuance of that a reference had already been made to the High Court and the matter is pending before the learned Company Judge. Needless to mention that the learned Company Judge would be deciding the matters more particularly based on the opinions expressed by the BIFR and AIFR. In the meantime however, the appellant also filed a writ petition No. 3635/2003 wherein he filed a WPMP No. 4596/2003 and in that, he sought for the stay of the order of the BIFR as well as AIFR. Now, we do not understand what is meant by the stay of that order because, those orders are only in the nature of the recommendations or the opinions as the case may be. The petitioner would always have an opportunity before the learned Company Judge to show that those opinions could still be ignored by the learned Company Judge. Be that as it may, we are not to express anything on that.

(3.) The learned Single Judge has refused the stay on the ground that he could not have interfered in the matter, there being the question of fact involved in the matter. Undoubtedly, the question as to how much would be the liabilities, how much would be the assets and whether there have been any efforts on the part of the company to wipe out the liabilities and whether the company is economically viable, are all essentially questions of fact on which much deliberation has been done by the BIFR as well as the AIFR. Therefore, in our opinion, the learned Single Judge was absolutely right in dismissing WPMP No. 4596/2003. Very significantly enough, the fact regarding the reference having been made and being pending before the learned Company Judge has been omitted to be stated in the writ petition. This only surfaced during the arguments which went on before us.