Winding-up proceedings require fresh judicial scrutiny where later rehabilitation evidence shows possible revival despite an earlier BIFR opinion.

In winding-up proceedings under SICA, the High Court must give due weight to the BIFR opinion, but it cannot treat that opinion as conclusive or abandon its own duty to examine later material. Where the company shows subsequent rehabilitation efforts, settlements with secured creditors, no-dues certificates, and progress under a scheme under section 391 of the Companies Act, 1956, changed circumstances may require a fresh assessment. The matter was therefore remitted for reconsideration in light of the company's improved financial position and alleged clearance of substantial dues.

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Issues: Whether the company court was bound to accept the BIFR and AAIFR opinion recommending winding up without independently considering the company's subsequent rehabilitation efforts and settlement of creditors, and whether the matter should be remitted for reconsideration in light of the improved financial position of the company.

Analysis: The company had placed material before the court showing substantial settlements with secured creditors and other claimants, including issuance of no-dues certificates and progress under a rehabilitation scheme framed under section 391 of the Companies Act, 1956. The settled position is that while the opinion of the BIFR carries weight in winding-up matters under the Sick Industrial Companies (Special Provisions) Act, 1985, the High Court is not divested of its own function and cannot mechanically treat that opinion as conclusive without examining whether changed circumstances warrant a fresh look. On the facts, the subsequent developments and alleged clearance of substantial dues required reconsideration by the Board.

Conclusion: The prior winding-up view was not treated as final for all purposes, and the matter was directed to be reconsidered afresh by the Board in light of the company's rehabilitation efforts and improved financial position.

Final Conclusion: The appeal succeeded to the extent that the winding-up matter was sent back for fresh consideration rather than being allowed to proceed solely on the earlier opinion.

Ratio Decidendi: In winding-up proceedings arising from SICA, the High Court must consider the BIFR opinion with due weight but cannot abdicate its function or ignore subsequent material showing a possible revival or changed financial circumstances.

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