Real interest test governs participation before BIFR and AAIFR where revival or winding-up of a company is in issue.

Section 13(2) of the Sick Industrial Companies (Special Provisions) Act, 1985 allows the BIFR and AAIFR to permit participation by persons interested in the subject matter of the proceeding, applying a real-interest test rather than the strict impleadment standard under the Code of Civil Procedure. A shareholder claiming an interest in a company under BIFR/AAIFR proceedings may be heard where the proceedings concern winding up or revival and the person seeks to place an alternative rehabilitation proposal before the forum. On the stated facts, the applicant was found to have sufficient interest and was rightly impleaded, so writ interference was unwarranted.

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Issues: Whether a person claiming a shareholding interest in a company under proceedings before the BIFR/AAIFR could be impleaded and heard on the basis of an interest in the subject matter of the proceedings.

Analysis: Section 13(2) of the Sick Industrial Companies (Special Provisions) Act, 1985 empowers the Board and the Appellate Authority to determine the extent to which persons interested or claiming to be interested in the subject matter of the proceeding may be permitted to participate. The test is not the strict impleadment standard under the Code of Civil Procedure, but whether the applicant has a real interest in the outcome before the BIFR/AAIFR. On the facts, the applicant was not a stranger: the company formed part of the family-controlled corporate structure, the proceedings involved a proposed winding up and a possible revival of the company, and the applicant sought to place an alternative revival proposal before the statutory forum.

Conclusion: The applicant had sufficient interest in the proceedings before the AAIFR and was rightly impleaded; interference in writ jurisdiction was unwarranted.

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