TaxTMI 
TaxTMI 
2012 (9) TMI 461
X X X X Extracts X X X X
X X X X Extracts X X X X
....ny on 2nd September, 1990 in terms of Section 3(i)(o) of the Sick Industrial Companies (Special Provisions) Act, 1985. Matter was referred to Board for Industrial and Financial Reconstruction (BIFR). Industrial Finance Corporation of India (IFCI) was appointed as the operating agency. 3. A rehabilitation scheme was proposed before the BIFR in 1996. As per the scheme, the total costs involved was Rs.78.44 crores, which required the promoters bringing in fresh funds to the tune of Rs.26 crores. Thereafter, several proposals were examined and after consideration, the consortium required the promoters to bring in funds to the extent of Rs.53 crores. At the time of approval, BIFR felt that the scheme could be fruitfully implemented in case the promoters increased their contribution to Rs.73.47 crores. 4. BIFR finally vide order dated 23rd February, 2000 recommended winding up of the company. Appeal filed against the said order was dismissed by the AAIFR vide order dated 21st June, 2000. A writ petition was preferred by the company against the order passed by the AAIFR but was subsequently withdrawn. The order passed by the BIFR attained finality. 5. Company Petition No.5....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... learned counsel for the applicants, within two months from the date of possession of the unit is given to them. These applications are accordingly disposed of in the aforesaid terms...". (emphasis supplied) 7. A Scheme was propounded by Mr. Satinder Pal Singh as a contributory and application CA No.757/2005 was filed under Sections 391 to 394 of the Companies Act, 1956 (for short „the Act‟) for consideration of the scheme and approval by the creditors and the workers. The Chairmen appointed for the meetings of the creditors and shareholders had submitted their reports to the court. In the meanwhile, some of the workers filed CA No.117/2004 before the company court stating that a sum of Rs.5.45 crores was due and payable to 181 workers and they were also entitled to certain other benefits. The settlement was not acceptable to them. 8. The company filed second motion u/s 391-394 of the Act in form of CA No. 1118/2005 which vide order dated 17th August, 2005 was converted and treated as a Company Petition No. 268/2005. 9. The said petition remained pending before the Company Judge till the impugned order dated 8th August, 2012 was passed. In the impugned order....
X X X X Extracts X X X X
X X X X Extracts X X X X
....5.00 lacs as per the terms of the compromised settlement with PNB." 13. Thus as per the scheme Rs.26.16 crores had to be paid to Punjab National Bank in installments and last installment was to be paid on or before 31st December, 2007. The company was also to pay interest @ 6% p.a. on reducing balance. At this stage we note that total dues of PNB as claimed by them in the original application filed before the Debt Recovery Tribunal (DRT, for short) on 21st February, 2003 was Rs.326 crores. The company got substantial reduction of the dues in terms of the OTS. 14. The company paid a sum of Rs.13.80 crore only and the balance amount, including interest, was not paid. PNB revoked the OTS by letter dated 14th June, 2007. 15. Subsequently in terms of the MOU dated 5th March, 2008, ACE Ltd. agreed and paid PNB Rs.15.01 crores. PNB in turn executed a deed of assignment dated 15th July, 2008, in favour of ACE Ltd. 16. The details of debt assigned to ACE Ltd. as stated in Schedule I of the MOU dated 5th March, 2008 is as under:- "Schedule 1 - Application of ACE loans for the debt assigned to ACE/repayments to unsecured creditors Particulars Total Rs/Lacs Paid Rs/Lacs....
X X X X Extracts X X X X
X X X X Extracts X X X X
....NB and the third when they entered into agreement with ACE Ltd. The company again defaulted. It is an accepted position that the company made payment of Rs. 2.09 crores only within a period of 12 months. They sought extension of time for payment of the principal amount and interest. No letter or communication was written by ACE Ltd. granting extension or agreeing to extension. ACE Ltd revoked the MOU in view of the non-payment vide letters dated 27th March, 2009 and 2nd April, 2009. Subsequently they entered into deed of assignment dated 17th April, 2009 with IFCI and received an amount of Rs.18.63 crores. 21. It is too late in the day now for the company or the propounders to say that they are ready and willing or were ready and willing to make payment in 2009 to ACE Ltd. These are empty promises or statements as no amount whatsoever has been paid since 2005 to any of the creditors and only Rs.2.09 crores paid to ACE Ltd. in 2008. Nothing prevented the company from making the payment or depositing the same with the Court to show their bonafide and desire. BIFR had recommended winding up in the year 2000. Winding up order was passed in 2003 and then kept in abeyance. It is time ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....opounded was based on OTS payment for PNB. The said OTS payments were not made. Payments were ultimately made to PNB by ACE Ltd. in terms of the deed of assignment. 26. As per MOU dated 5th March, 2008, the company had to make payment of Rs.16.61 crores with interest @ 24% with quarterly rests, within 12 months. Payment of Rs.2.09 crores was made within the said period and no further payment was made. It is obvious that the company had agreed to payment of interest @ 24% as they were not able to secure credit from any other third sources and wanted payment to be made to PNB who were ready to write off debt of Rs.326 crores as claimed in the original application before DRT for merely Rs.26 crores. The company and the propounders have been delaying, pushing and postponing payment to the creditors. The wait cannot be endless. The interest of creditors is paramount and has to be protected. The debenture holders and preferential shareholders have not been paid. The period of four years and two years for payment to debenture holders and preferential shareholders in 2012 cannot be accepted. Rs.12 crores in form of equity, unsecured loans etc. have not been brought in the books and paid....