2000 (8) TMI 1005

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....nding or an order of winding up, has been passed under the Companies Act, 1956 ('Companies Act')? Incidentally further question to be adjudicated is whether appointment of an official liquidator/liquidator under the Companies Act would take away jurisdiction of BIFR established under the Sick Industrial Companies (Special Provisions) Act, 1985 (the 'Act') to deal with a reference made under section 15 of the said Act? 2. Undisputed factual position is that BIFR refused to entertain application for reference made by the petitioner under section 15, on the ground that an official liquidator had been appointed, in terms of the consent arrangement made between the parties. The observations in this regard made by the BIFR are in the following....

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.... been further suggested on behalf of the respondent-bank that the action of the appellant was mala fide inasmuch as it sought time from the court to make the payment or the amount due and after seeking indulgence mala fidely made the reference to the BIFR on 30th September, 1997. It is contended that after the order of the winding up and appointment of the liquidator, the Board of Directors had no jurisdiction to move the BIFR by passing a resolution. Such a submission cannot be accepted. In a winding up petition the liquidator is appointed to protect the assets of a company for the benefit of its creditors, secured and unsecured and others. It is not the function of the official liquidator to start the process of rehabilitation of the comp....

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....le conclusion is that both the BIFR and AAIFR were wrong in holding that the reference made under section 15 before the BIFR was not maintainable. The BIFR is to take up the reference in accordance with law. 5. The learned counsel appearing for some of the respondents submitted that the petitioner has not come with clean hands and it has suppressed many materials and vital aspects. It is also submitted that the petitioner is syphoning away funds by surreptitious disposal of assets with the intention of defrauding the creditors. 6. In Real value Appliances Ltd. v. Canara Bank [1998] 5 SSC 554, it was observed that when section 16(1) says that BIFR can conduct enquiry 'in such a manner as may deem fit', the said words are intended only ....