Writ interference in sick company rehabilitation rejected where expert viability findings and creditor views were properly considered

In sick industrial company proceedings, expert findings on rehabilitation viability will not usually be disturbed in writ jurisdiction where the statutory authorities have considered the relevant material and the affected financial institutions' views. The Board and the Appellate Authority may rely on an operating agency's examination of the revised proposal, and the process is not treated as an adversarial lis. Where the record shows that the company could not be made viable within permissible parameters, and the petitioner did not participate in the joint meeting, the High Court will not ordinarily order remand if passage of time makes fresh consideration futile.

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Issues: Whether the High Court should interfere with the Board for Industrial and Financial Reconstruction and Appellate Authority for Industrial and Financial Reconstruction orders rejecting the rehabilitation proposal and directing further action in the sick industrial company proceedings.

Analysis: Proceedings under the Sick Industrial Companies (Special Provisions) Act, 1985 are meant to secure expeditious examination of sickness, revival prospects, and, where revival is not feasible, timely protection of the creditors' interests. The Board is an expert statutory body and may rely on the assistance and report of an operating agency. The process is not an adversarial lis, but the financial institutions are affected parties whose views must be considered. The record showed that the operating agency examined the company's viability, considered the revised proposal, and concluded that the unit could not be made viable within the permissible parameters. The petitioner's non-participation in the joint meeting and the changed passage of time also weakened the plea for remand. In supervisory jurisdiction, interference was not warranted where the statutory authorities had taken relevant factors into account and no useful purpose would be served by setting aside the orders.

Conclusion: The challenge to the orders of the Board and the Appellate Authority failed, and no remand or fresh consideration was directed.

Ratio Decidendi: In proceedings under the sick industrial company framework, the High Court will not ordinarily interfere in writ jurisdiction with expert findings on rehabilitation viability when the statutory authorities have considered the relevant material, the affected financial institutions have been heard, and the passage of time makes remand futile.

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