TaxTMI 
TaxTMI 
2018 (1) TMI 953
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....inechem Ltd. v. Union of India and Ors (hereinafter 'Ashapura'). Vide order dated 1st November, 2017, the challenge to Section 4(b) of the Repeal Act has been rejected by this Court in Ashapura (supra). 3. The findings in the said judgment are equally applicable to the present petition and it is held accordingly. 4. In addition Mr. Ramji Srinivasan, learned Senior Counsel for the petitioner has urged some further submissions which are being dealt with in the present order. Brief Background 5. The petitioner claims to be a leading turnkey projects executing company, manufacturing a full range of industrial equipment for sugar and other industries. It ran a highly profitable business till 1994-95, when it suffered severe losses due to various reasons. 6. The petitioner filed a reference with the Board for Industrial & Financial Reconstruction (hereinafter 'BIFR') in 1998 and was declared a 'sick company' on 21st April, 1999. IDBI was appointed as the operating agency for the purposes of formulating the scheme. 7. According to the petitioner, it has settled and paid the restructured amounts of all of its 28 secured lenders, and had obtained no dues certificate from 27 secured ....
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....ankruptcy Code, 2016 within one hundred and eighty days from the commencement of the Insolvency and Bankruptcy Code, 2016 in accordance with the provisions of the Insolvency and Bankruptcy Code, 2016. Provided further that no fees shall be payable for making such reference under Insolvency and Bankruptcy Code, 2016 by a company whose appeal or reference or inquiry stands abated under this clause]" THE REMOVAL OF DIFFICULTY ORDER, 2017: S.O. 1683(E).- Whereas, the Insolvency and Bankruptcy Code, 2016 (31 of 2016 (hereinafter referred to as the said Code) received the assent of the President on 28th May, 2016 and was published in the official Gazette on the same date; And, whereas, section 252 of the said Code amended the Sick Industrial Companies (Special Provisions) Repeal Act, 2003 (1of 2004) in the manner specified in the Eighth Schedule to the said Code; And, whereas, the un-amended second proviso to clause (b) of section 4 of the Sick Industrial Companies (Special Provisions) Repeal Act, 2003 provides that any scheme sanctioned under sub-section (4) or any scheme under implementation under sub-section (12) of section 18 of the repealed enactment i.e., the Sick In....
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....ruptcy Code (Removal of Difficulties) Order, 2017. 2. In the Insolvency and Bankruptcy Code, 2016, in the Eighth Schedule, relating to amendment to the Sick Industrial Companies (Special Provisions) Repeal Act, 2003, in section 4, in clause (b), after the second proviso, the following provisos shall be inserted, namely:- "Provided also that any scheme sanctioned under sub-section (4) or any scheme under implementation under sub-section (12) of section 18 of the Sick Industrial Companies (Special Provisions) Act, 1985 shall be deemed to be an approved resolution plan under sub-section (1) of section 31 of the Insolvency and Bankruptcy Code, 2016 and the same shall be dealt with, in accordance with the provisions of Part II of the said code: Provided also that in case, the statutory period within which an appeal was allowed under the Sick Industrial Companies (Special Provisions) Act, 1985 against an order of the Board had not expired as on the date of notification of this Act, an appeal against any such deemed approved resolution plan may be preferred by any person before National Company Law Appellate Tribunal within ninety days from the date of publication of this order."....
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....shapura Minechem Ltd. v. Union of India and Ors 15. This Court, in Ashapura (supra), has held that the object with which the Code was enacted was to completely reform the existing insolvency regime. The Code has been enacted to replace SICA. It is the clear and categorical intention of the Legislature under Section 4(b) that all proceedings under SICA pending before the AAIFR or BIFR as on 1st December, 2016 would abate. This principle was applied uniformly without any exceptions. Section 5(1)(d) only provides an exception to such class of cases where the BIFR had already passed an order for sanctioning the scheme. Thus, schemes which were sanctioned prior to 1st December, 2016 would be protected. The saving clause thus only applies to schemes already sanctioned by the BIFR and none else. All other persons whose proceedings were still pending could only avail of the remedy of approaching the NCLT under the Code. 16. In Ashapura (supra), this Court has also held that the differentiation between sick companies where draft schemes have been approved, which are treated as 'deemed approved resolution plans' under the Code, and such cases where draft schemes have not been approved....
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....reover, in the said case, the amendment did not expressly or by implication intend for the new amended provision to apply to all new appeals arising from pending cases. But even in the said judgment, the Supreme Court clearly relies upon the observations of the Privy Council that a legislation cannot be held to act retrospectively, unless a clear intention to this effect is manifested. The Supreme Court holds as under:- "Such a vested right cannot be taken away except by express enactment or necessary intendment. An intention to interfere with or to impair or imperil such a vested right cannot be presumed unless such intention be clearly manifested by express words or necessary implication." (emphasis supplied) Thus, if there is a manifest intention in the legislation, the same would have to be given effect to. 19. Similar is the view expressed in Nogendra Nath Bose v. Mon Mohan Singha Roy AIR 1931 Cal 100, which also held that a right to appeal cannot be taken away in the absence of a express enactment. Moreover, as held in British Bank of India Vs. CIT [2004] (1) Mh.L.J.297, there is no inherent right of appeal and it has to be specifically conferred by the statute. 20. A....
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.... shows that there is one broad classification which has been made by the Legislature, namely cases in which schemes are sanctioned and those cases in which the schemes or proceedings are still pending. In the latter class of cases, the legislature provides the remedy of approaching the NCLT within a period of 180 days from the date when the Code comes into effect. Such proceedings would then be dealt with "in accordance with the provisions of Insolvency and Bankruptcy Act, 2016." 23. During the course of submissions, Mr. Srinivasan repeatedly urged that the petitioner's case, having been dealt with in accordance with the SICA and having reached an extremely advanced stage, to relegate it to the NCLT, to be treated in accordance with the Code, results in severe injustice. The legal position on this issue has been settled by the Supreme Court in State of Rajasthan Vs. Mangilal Pindwal AIR 1996 SC 2181 wherein the Court quoted with approval the following passage on 'Craies on Statute Law' ""When an Act of Parliament is repealed," said Lord Tenterden in Surtees v. Ellison," it must be considered (except as to transactions past and closed) as if it had never existed. That is the ....