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Issues: Whether, on receipt of an opinion of the Board under section 20 of the Sick Industrial Companies (Special Provisions) Act, 1985, the Company Court is required to admit the winding-up petition and direct advertisement in accordance with Rules 96, 99 and 24 of the Companies (Court) Rules, 1959, or whether such formal procedure can be dispensed with.
Analysis: The opinion of the Board under section 20 of the Sick Industrial Companies (Special Provisions) Act, 1985 is not to be treated as a mere formality. The Court has to take that opinion into account and independently decide whether winding up should proceed. At the same time, the statutory scheme does not permit the Court to bypass the procedural safeguards attached to a winding-up petition. Rules 96, 99 and 24 of the Companies (Court) Rules, 1959 require admission of the petition and publication of notice so that interested persons may appear and be heard before final orders are made. Dispensing with admission and advertisement would reduce the Court's role to that of a rubber stamp and would defeat the purpose of the procedural rules.
Conclusion: The Court held that the petition had to be admitted and advertised, and the winding-up proceedings were to continue in accordance with the prescribed rules.
Ratio Decidendi: A winding-up petition founded on a Board opinion under section 20 of the Sick Industrial Companies (Special Provisions) Act, 1985 must still comply with the mandatory admission and advertisement requirements under the Companies (Court) Rules, 1959, because the Company Court must exercise its own judicial function and cannot act mechanically on the Board's opinion.
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