TaxTMI 
TaxTMI 
TaxTMI 
2006 (4) TMI 254
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....ered as a company under the Companies Act, 1956. This company was promoted by the Punjab State Industrial Development Corporation Limited (hereinafter referred to as 'PSIDC') and the PSIDC held 46.13 per cent shares in it. On recommendation of the BIFR (Board for Industrial & Financial Reconstruction) under the Sick Industrial Companies (Special Provisions) Act, 1985, the winding up order was passed qua the PNFC on 27-7-2001. 2. In view of its financial difficulties the PNFC stopped paying the wages to its workers from September, 1999. The workers were therefore agitating for payment of their wages. It appears that they approached the Chief Minister of the State of Punjab in this behalf. On a proposal put forth by the concerned department,....
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....review of the said order of the Company Judge on the ground that it was not in a sound financial position to make the payment. Secondly, the PSIDC denied its liability to pay on the ground that the workers who were to be paid were not the workers of the PSIDC. Lastly, it was represented that the interest of the workers was protected because the workers dues were the first charge on the sale proceeds of assets of the company in view of section 529A of the Companies Act. The review application was dismissed vide order dated 7-6-2002. Thereafter, the appellant filed an appeal against the order of the Company Judge dated 16-5-2002 before a Division Bench of the High Court. The said appeal was dismissed vide order dated 4-7-2002 which is subject....
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....y the PSIDC. As already notified, the PNFC is a separate legal entity being a Company Limited by shares under the Companies Act. The PNFC is not a Government company while the PSIDC is a wholly-owned undertaking of the Government of Punjab. Even according to respondents, PSIDC held only 46.23 per cent of equity, other public financial institutions held 14.59 per cent and public held the remaining 39.18 per cent. 8. After drawing our attention to the legal status of the two companies involved, the learned counsel for the appellant drew our attention to the note of the Chief Minister of Punjab. It is submitted with reference to the said Note that it can neither be said to be an order of the State Government nor can it has any binding force s....
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....] 4 SCC 657 in support of this contention. In our view this judgment does not help the respondent. Under section 446, the powers of the Company Judge qua a Company under liquidation may be wide, but that does not empower the Company Judge to pass an order making a distinct and separate corporation, a third party, liable for the liabilities of the Company in liquidation. This aspect unfortunately has not been adverted to either by the learned Company Judge or by the Division Bench of the High Court. 10. Reliance was placed on the so-called order of the Chief Minister permitting the PSIDC to raise funds in order to meet the liability of the PNFC towards salary of its workers for at least six months. We have carefully perused the note of the ....