Rehabilitation scheme under SICA must revive the existing undertaking, not create a new venture at another site.

Alternative remedy does not, by itself, bar writ jurisdiction where the challenge raises a jurisdictional or pure question of law; the writ petition was therefore maintainable and the preliminary objection failed. A rehabilitation scheme under the Sick Industrial Companies (Special Provisions) Act, 1985 must be directed to revival of the existing sick industrial undertaking through measures contemplated by the Act, such as reconstruction, management change, amalgamation, sale or lease, or related remedial steps. A proposal that abandons the existing unit, shifts to a different site, changes the business, and establishes a wholly new venture without salvaging the existing productive assets falls outside the statutory object. The rejection of such a proposal was justified.

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Issues: (i) whether the writ petition was maintainable despite the availability of an appellate remedy under the statutory scheme, and (ii) whether a rehabilitation proposal under the Sick Industrial Companies (Special Provisions) Act, 1985 could validly be rejected as incompatible with the object and scope of the Act when it sought to set up a wholly new venture at a different site instead of reviving the existing industrial undertaking.

Issue (i): whether the writ petition was maintainable despite the availability of an appellate remedy under the statutory scheme

Analysis: The availability of an alternative remedy does not by itself bar writ jurisdiction where the challenge goes to jurisdiction or raises a pure question of law. The Court held that the objection could be overruled because the validity of the Board's reasoning, namely whether it could refuse a scheme on the ground that it was outside the scope of the Act, was a question going to jurisdiction and could be examined without resolving disputed facts.

Conclusion: The writ petition was maintainable and the preliminary objection was rejected.

Issue (ii): whether a rehabilitation proposal under the Sick Industrial Companies (Special Provisions) Act, 1985 could validly be rejected as incompatible with the object and scope of the Act when it sought to set up a wholly new venture at a different site instead of reviving the existing industrial undertaking

Analysis: The Act was enacted to revive and rehabilitate potentially viable sick industrial companies by salvaging productive assets, preserving employment, and protecting the interests of banks and financial institutions. A scheme under section 18 must fit within the statutory framework of financial reconstruction, change in management, amalgamation, sale or lease of the industrial undertaking, rationalisation of personnel, or allied preventive, ameliorative or remedial measures. A proposal that abandons the existing unit, transfers or dissipates its assets, shifts to a different site, changes the business altogether, and seeks to establish a new industry with no use of the existing productive assets does not amount to rehabilitation of the sick industrial company within the meaning of the Act.

Conclusion: The Board was justified in rejecting the proposal as outside the scope of the Act.

Final Conclusion: The challenge to the rejection order failed because the impugned scheme was not a permissible rehabilitation measure under the statutory scheme governing sick industrial companies.

Ratio Decidendi: A rehabilitation scheme under the Sick Industrial Companies (Special Provisions) Act, 1985 must aim at revival of the existing sick industrial company through measures contemplated by the Act and cannot be sanctioned if it is in substance a proposal for a new venture unconnected with salvaging the company's productive assets or preserving its industrial undertaking.

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