DEEPAK SINGHANIA Vs. UNION OF INDIA AND OTHERS

JUDGEMENT

(1.) The petitioner contends that he is a promoter, director and guarantor in M/s LML Limited, which is a company incorporated under the Companies Act, 1956. This company was declared "sick" under the provisions of Sick Industrial Companies (Special Provisions) Act, 1985 (SICA). The rehabilitation scheme was pending consideration before the Board constituted under the said Act and, during its pendency, the Act was abolished with effect from 01.12.2016. The repeal Act provided a saving clause, namely, that any action taken under the Act will not affect any right, privilege, obligation or liability that had already been acquired by the parties under the Act.

(2.) It was contended that for implementation of the rehabilitation scheme various meetings were held with the financial institutions and the respondent- Bank agreed and sanctioned the repayment of the overdues. Such repayment schedule was subject to the sanction of the revival scheme by the Board for Industrial and Financial Reconstruction (BIFR). But before the scheme could be granted, the Act was abolished and the matter came to an end.

(3.) One of the contentions raised by the petitioner is that the action of the respondents in sanctioning the repayment of the dues is binding upon them and such sanction is saved by Section 5 of the Repeal Act.