Sixty-day reference period under sick industrial law is a duty, not a limitation bar, for delayed filings

Section 15(1) of the Sick Industrial Companies (Special Provisions) Act, 1985 imposes a duty on the Board of Directors to make a reference within sixty days of finalisation of audited accounts, but that period is not a limitation bar that extinguishes a delayed reference. The provision is part of a rehabilitation framework aimed at early detection of sickness and remedial intervention, and it must be read with the Act's broader scheme allowing references under section 16 and penal consequences for non-compliance under section 33. A delayed reference therefore cannot be rejected solely for being filed after sixty days, because that construction would undermine the Act's rehabilitative object.

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Issues: Whether the period of sixty days prescribed in section 15(1) of the Sick Industrial Companies (Special Provisions) Act, 1985 for making a reference by the Board of Directors is a limitation period that extinguishes the reference if not complied with, or only a statutory obligation carrying penal consequences.

Analysis: The Act is a rehabilitation statute intended to secure early detection of sickness in industrial companies and to enable inquiry and remedial measures by the Board. Section 15(1) casts a duty on the Board of Directors to make a reference within sixty days of finalisation of the audited accounts, but the statute does not create a bar against entertaining a delayed reference. The structure of the Act shows that the Board may also act on a reference under section 16(1) and even on its own information under section 16(1)(b), while section 33(1) provides penal consequences for violation of the Act. Reading section 15(1) as an extinguishing limitation provision would defeat the object of the Act and prevent the Board from performing its rehabilitative function.

Conclusion: The sixty-day period in section 15(1) is not a limitation period that mandates dismissal of a delayed reference. The reference could not be rejected merely for being filed beyond sixty days, and the impugned orders were unsustainable.

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