1 board for industrial and financial reconstruction bench iii case no ...

Case No.93/1987 

M/s Alluminium Industries Ltd 

BOARD FOR INDUSTRIAL AND FINANCIAL RECONSTRUCTION 

BENCH III 

CASE NO. 93/87 M/S.ALUMINIUM INDUSTRIES LTD. 

SUMMARY RECORD OF THE PROCEEDINGS OF THE HEARING HELD 

ON 30-01-2012 BEFORE BENCH-III CONSISTING OF 

SHRI NIRMAL SINGH, CHAIRMAN AND SHRI YK GAIHA, MEMBER 

Present 

M/s. Aluminum Industries Ltd. 

State Bank of Travancore (OA) 

Canara Bank 

Govt. of Kerala 

ICICI Bank 

Punjab National Bank 

M/s Pridhvi Asset Reconstruction 

Securitisation Co. Ltd 

Name & Designation of the 

Representative S/Shri 

1. Prashant Somani, Director 

2. Vivek Sibal, Advocate 

3. Nitin Kothari, Auth. Rep. 

4. Sumesh Dhawan, Advocate 

1.Thiagarajan.C,BranchManager 

2.Anup Kumar, Manager 

R.Saikumar, Manager 

Ramesh Babu, Advocate 

Mahesh Kumar, Advocate\ 

Dileep K Jha, Manager 

Vijay Kumar, Advocate 

U. Eliazer (Retired Employees U. Eliazer, President 

Welfare Association 

N.Sambasiva Rao 

Alluminium Ind. Staff Assn. Hyderabad 

ALIND Workers Congress (INTUC) 

M/s Voltas Impex Pvt Ltd 

ALIND Contract Workers Union 

Hyderabad 

ALIND Emp. Union, 

Revival Committee, Kundara 

S. Rama Gopal, VP 

D.Satyakumar 

B. Ramakrishnan, Gen Secy 

1. Nilesh Sharma, FCA 

2. Bhuvan Arora 

1. A Ravinder Reddy,V.P. 

2. S Laxman Gee,GS 

P.M.A. Rehman, Convener 

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Case No.93/1987 


ALIND Workers Union, Kundara 

ALIND Steel Plant Emp. Union 

Union (AITUC), Kundara 

ALIND Steel Plant Workers 

Congress (INTUC), Kundara 

ALIND Emp. Union, Hirakud 

G. Ramachandran, Secretary 

B. Rajeev, Gen Secretary 

M. Sivaprasad, Gen Secretary 

1. Lokanath Sabat, Gen Secy 

2. C.M.Majhi 

ALIND Machinery Div. Emp Union 1. J.B,.Rai, 

Hyderabad 2. Sudhakar. V, 

ALIND Emp. Assn. Conductor Div. 

Hyderabad 

ALIND workers Samrakshna Samathi 

Kundara 

ALIND Switchgear Emp.Assn.,Mannar 

ALIND Switchgear Emp.Union,Mannar 

Kotak Mahindra Bank 

(assignee of ICICI & SBT) 

Kundra Aluminium Factory Workers 

Union, Kundra 

ALIND Material Handling Division, 

Hyderabad 

AREU, Trivandrum 

ALIND Machinery Div.Retired 

Employees Welfare Union,Hyderabad 

ALIND Steel Product Emp.Federation 

Coordination of ALIND Trade Union 

C. N. Chari 

P.Krishna 

1. P.G Scaria, Advocate 

2. S.Johnson Aliyarkutty 

1. Mohan Kumar 

2. Chandrakumar 

Jacob Thomas, ASEU (CITU) 

Vikas Bhardwaj, 

Associate Vice President 

Rajeev M.K. Gen Secy 

K. Arjunrao 

S.Ajith Kumar 

1.P.Satya Prakash,VP 

2.S.A.Khander,GS 

S. Mony, Advocate 

S. Mony, Advocate 

*********** 

1. On a referen ce filed u n der s ection 15 (1) of SICA, th e Boa rd, in its 

h ea rin g h eld on 20/ 10/ 87, decla red th e com pa n y M/ s Alu m in u m 

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Case No.93/1987 


In du s tries Ltd. (AIL) a s a Sick In du s tria l Un derta kin g , with in th e m ea n in g 

of Section 3(1)(o) of th e Act, a n d th e Boa rd a ppoin ted th e IIBI a s th e 

Opera tin g Agen cy (OA) to form u la te a s ch em e for reviva l of th e s ick 

com pa n y Th e Boa rd, in its s u bs equ en t h ea rin g h eld on 27/ 06/ 02, relieved 

IIBI from th e res pon s ibility a s th e OA a n d a ppoin ted th e Sta te Ba n k of 

Tra va n core (SBT) a s th e OA. Th e Boa rd, in its h ea rin g h eld on 10/ 11/ 03, 

directed th a t s epa ra te reviva l s ch em es be con s idered/ a pproved in r/ o th e 

com pa n y s th ree (3) Divis ion s viz Ma ch in ery Divis ion (MD)/ Con du ctor 

Divis ion (CD) a t Hydera ba d, Rela ys Divis ion (RD) a t Th iru va n th a pu ra m a n d 

Switch gea r Divis ion (SD) a t Ma n n a r a n d th e Boa rd, a ccordin gly, directed 

the OA (SBT) to submit separate revival proposals in r/o each of these three 

(3) Divisions. 

2. Based on the draft revival schemes [DRS(s)] received from the OA, the 

Boa rd prepa red/ circu la ted th e DRS(s ) in res pect of ea ch of th e s a id th ree(3) 

Divis ion s , vide Boa rd s order(s ) dt. 28/ 01/ 05, to a ll con cern ed a gen cies , for 

th eir con s en ts / com m en ts , in term s of provis ion u / s 19(1) & 19(2) of th e 

Act, with a direction th a t th e objection (s )/ s u ggestion s in r/ o th e DRS(s ), if 

a n y, wou ld be con s idered by th e Boa rd, in its m a n da tory hearing, 

scheduled on 26/7/05. 

3. Th e Boa rd, in its s a id m a n da tory h eld on 26/ 7/ 05, n oted, interalia, 

th a t s om e of th e a gen cies , bes ides ra is in g certa in objection (s ) for 

consideration of division-wise revival schemes of the sick company M/s AIL, 

a ls o ra is ed objection s for th e propos ed dis pos a l of th e com pa n y s 

la n d/ a s s ets , ba s ed on th e offers / prices received du rin g Dec 2002. Th e 

Boa rd n oted in th e s a id h ea rin g th a t th e re-open in g of th e fin a lized proces s 

for dis pos a l of th e com pa n y s s u rplu s la n d/ a s s ets wou ld be a n u n -ending 

exercis e. In view of th e con s en ts received from th e con cern ed a gen cies 

rega rdin g th e reliefs & con ces s ion s en vis a ged from th em in r/ o th e DRS(s ), 

th e Boa rd s a n ction ed th ree (3) sepa ra te reviva l s ch em es for th e com pa n y s 

th ree (3) divis ion s viz MD/ CD a t Hydera ba d, RD a t Th iru va n th a p u ra m & 

SD a t Mannar, h a vin g con s idered th e cut-off-da te (COD) a s 31/ 03/ 04, 

3

Case No.93/1987 


wh ich , h erein a fter, wou ld be referred to a s th e (SS-05- MD/ CD), (SS-05- 

RD) & (SS-05-SD) res pectively. Th e Boa rd a ppoin ted th e SBT a s th e 

Mon itorin g Agen cy (MA) to m on itor th e progres s of im plem en ta tion of th es e 

reviva l s ch em es . Th e Boa rd fu rth er directed th a t th e m a tter rega rdin g 

reviva l of Hirku n d (Oris s a ) & Ku n dra (Kera la ) Divis ion s wou ld be 

considered by the Board separately. 

4. Appea l n os . 91/ 2005, 15/ 2006, 53/ 2005, 98/ 2005, 120/ 2005, 

127/ 2005, 136/ 2005 a n d 1 77/ 2005, were filed by M/ s .Un ited Sh ippers 

Ltd. (USL), M/ s .Alu m in iu m In du s tries Em ployees Un ion (AIEU) (Hira ku n d), 

Alin d Em ployees Un ion Reviva l Com m ittee (AEURC), M/ s .GVK 

Petroch em ica ls Ltd. (GVKPL), M/ s .Alin d Ma ch in ery Divis ion Em ployees 

Un ion (AMDEU), M/ s . Ea s t Coa s t Meta l & Min era ls Pvt. Ltd. (ECMMPL), 

M/ s . Globa l Corpora tion Ltd . (GCL) a n d M/ s . Vija y Electrica l Ltd. (VEL), 

before Hon ble AAIFR, ch a llen gin g th e BIFR s order dt.3.6.05 (i.e. th e order 

th rou gh wh ich th e BIFR com m u n ica ted its a pprova l on th e 

recom m en da tion of th e MA (SBT) ASC for s a le of th e s ick com pa n y s two (2) 

non-via ble u n its viz. Hira ku n d, Oris s a a n d Ku n dra , Kera la ) a n d a ls o 

ch a llen gin g th e BIFR s s u bsequ en t ord er dt. 26.7.05 (i.e. th e order by wh ich 

three (3) separate schemes were sanctioned by the Board for revival of three 

(3) Divisions of the sick company M/s.AIL). 

5. Hon ble AAIFR, du rin g its h ea rin g ta ken on 15.11.06, n oted, interalia, 

as under :- 

(a) Th e a pproa ch of BIFR wa s erron eou s . Th e com pa n y s via ble u n its 

s h ou ld be revived a n d th e u n -via ble u n its s h ou ld be dis pos ed-of, a n d th is 

should be done under the umbrella of one scheme which would take care-of 

in teres t of a ll th e com pa n y s s ta ke h olders . After s a n ction / im plem en ta tion 

of th e th ree (3) s epa ra te s ch em es for th ree (3) divis ion s of th e s ick com pa n y 

M/ s AIL, th ere wou ld be n o m a n u fa ctu rin g u n its left in th e com pa n y for 

revival by the BIFR. 

(b) Th e n et effect of th e procedu re a dopted by th e BIFR is th a t a ll th e 

assets of the sick company would stand transferred to third parties, but the 

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Case No.93/1987 


m a jor portion of th e com pa n y s lia bilities viz s ta tu tory du es , la bou r du es , 

du es of th e u n -s ecu red creditors wou ld be left beh in d in a s h ell com pa n y, 

with no recourse to these agencies/creditors to effect recovery of their dues. 

(c) Con s equ en t to th ree (3) s epa ra te s ch em es s a n ction ed by BIFR, th e 

workers of certa in u n its of th e com pa n y h a ve been given preferen tia l 

treatment over the other workers. 

(d) Th e order dt. 03/ 06/ 05 pa s s ed by BIFR u / s 22A of SICA is m is - 

con ceived. Th e order is pa ten tly illega l, es pecia lly a s it wa s is s u ed by th e 

Bench officer of the BIFR, without hearing the affected parties. 

(e) 

Th e th ree (3) in depen den t s ch em es were s a n ction ed by th e BIFR, 

with ou t a ddres s in g th e con cern of a ll th e com pa n y s s ta ke-holders, 

including the creditors and workmen etc. and such an action by the BIFR is 

in contravention to the provision(s) of SICA. 

(f) 

Th e proces s of in vitin g of offers for s a le/ h ivin g-off of th e com pa n y s 

unit(s) was/were not done in a transparent manner. 

(g) 

The valuation of the com pa n y s a s s ets wa s don e a bou t th ree (3) yea rs 

ba ck a n d th ere wa s a con s idera ble tim e-ga p between th e in vita tion of offers 

vis-à -vis fra m in g-u p of th e DRS. Th e As s ets Sa le Com m ittee (ASC) wa s n ot 

form ed, in term s of th e BIFR s order dt. 18.11.03. 

(h) 

Th e a u dited a ccou n ts of th e com pa n y were n ot relia ble, prim a rily 

beca u s e of qu a lifica tion m a de by th e a u ditors th erein . Wh en th e com pa n y s 

a ccou n ts were n ot a ccu ra te a n d th e com pa n y s a s s ets & lia bilities were a ls o 

n ot kn own , it wa s n ot pos s ible to form u la te a com preh en s ive reh a bilita tion 

scheme. 

6. Fin a lly, Hon ble AAIFR, vide its order dt. 6 .2 .0 7 , had s e t as ide 

BIFR s o rde rs dt. 3 .6 .0 5 and 2 6 .7 .0 5 (i.e . SS-05) a n d Hon ble AAIFR 

issued the following further directions:- 

(i) 

Th e Boa rd of Directors of ALIND s h a ll be recon s titu ted forth with 

to in clu de 3 pers on s to be n om in a ted a s Directors by th e exis tin g 

prom oters a n d th e n ew Directors s h a ll a s s u m e office im m edia tely 

on nomination. 

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Case No.93/1987 


(ii) 

(iii) 

(iv) 

Th e com pa n y s h a ll a ppoin t a firm of a u ditors from th e pa n el of 

approved auditors by C&AG to draw up the accounts and financial 

s ta tem en t of ALIND, get th e s a m e a u dited a n d a dopted in th e 

EGM within 16 weeks from the date of this order. 

Th e a u dited fin a n cia l s ta tem en ts s h ou ld be filed with BIFR, wh o 

a re th erea fter directed to give a period of 4 weeks to th e exis tin g 

prom oters of ALIND to s u bm it a com preh en sive reh a bilita tion 

s ch em e to th e OA/ BIFR for ta kin g n eces s a ry fu rth er s teps in 

accordance with law. 

In th e even t th e exis tin g prom oters a re u n a ble to s u bm it a 

com preh en s ive reh a bilita tion s ch em e for ALIND with in th e 

s tipu la ted period, BIFR s h ou ld explore oth er a ven u es for revivin g 

ALIND including the option of change of management. 

6 (i). Bein g a ggrieved by th e orders pa s s ed by AAIFR, th e a pplica n t M/ s 

Volta Im p ex Ltd. (VIL) filed a WP No. 3369/ 2007, in th e Hon ble High Cou rt 

of An dh ra Pra des h (HCAP), ch a llen gin g Hon ble AAIFR s a bove order dt. 

06/ 02/ 07 a n d HCAP pa s s ed a n interim order dt. 30/ 04/ 07, wh erein th e 

HCAP directed th e BIFR n ot to fin a lis e a n y s ch em e, till 30/ 06/ 07, if s u ch a 

s ch em e is s u bm itted by th e s ick com pa n y M/ s AIL or by M/ s Un ited 

Sh ippers Ltd. (USL). HCAP a ls o perm itted th e com pa n y M/ s AIL to h old 

EGM on 26/ 05/ 07 for a doption th e com pa n y s a ccou n ts wh ich wa s 

reported to h a ve a lrea dy been a u dited. HCAP pos ted th e ca s e for h ea rin g 

again on 04/06/07. 

(ii) HCAP h ea rd th e WP No. 3369/ 07 on 11/ 06/ 07 a n d directed th a t th e 

interim order, ea rlier pa s s ed by HCAP on 30/ 04/ 07 wou ld s ta n d exten ded 

u pto 18/ 06/ 07 a n d HCAP a ls o lis ted for ca s e for h ea rin g a ga in on 

14/06/07. 

(iii). Th e a pplica n t M/ s VIL filed a M WP No. n o. 4304/ 2007 in r/ o th eir 

WP No. 3 369/ 2007 before HCAP a n d th e HCAP directed, vide its order dt. 

14/ 06/ 07, th a t th e in terim ord er ea rlier pa ssed on 30/ 04/ 07 wou ld 

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Case No.93/1987 


con tin u e u n til fu rth er order(s ) a n d th e im plem en ta tion of direction s 3 & 4 

is s u ed by th e AAIFR is its order dt. 06/ 02/ 07 with rega rd to s u bm is s ion of 

a reh a bilita tion s ch em e wou ld be s u bject to fu rth er order(s ) th a t m igh t be 

pa s s ed in r/ o WP No. 3369/ 2007. HCAP pos ted th e ca s e for h ea rin g a ga in 

on 03/07/07. 

7. Th e Boa rd received a copy of order da ted 23.5.2008 pa s s ed by th e 

Hon ble High Cou rt of Kera la . It h a s been s ta ted in th e order th a t, th e BIFR 

s h a ll keep a clos e wa tch of th e fu n ction in g of th e com pa n y. It s h a ll be 

en s u red th a t th e prom oter s do n ot a llow th e com pa n y to go to ru in s . A 

n u m ber of repres en ta tion s h a ve been received in th e Boa rd s office from 

involved parties for evaluation of the present status of the case and issuance 

of necessary direction for the revival of the Company. 

8.1 In th e h ea rin g h eld on 10.7.2008, th e Ben ch con s idered th e orders 

pa s s ed by th e Hon ble High Cou rts a n d th e order pa s s ed by Hon ble AAIFR. 

Th e deta ils of pen din g ca s es before th e Hon ble High Cou rts in res pect of 

the Company at present are as under:- 

S.No. High Court 

& W.P.No. 

1. Hon ble 

High Cou rt 

of Kerala 

Writ 

Petition No. 

6625/07 

Filed by 

K.Paulouse 

(Bidder for 

Relay 

Division 

Trivandrum) 

Presents status/ Direction of the 

Court 

Filed with pra yer to s et a s ide th e 

AAIFR order da ted 6.2.2007. Th e 

Hon ble High Cou rt of Kera la vide 

order da ted 23.5.2008 dis m is s ed th e 

WP with certain directions such as 

(a ) Needles s to m en tion th e BIFR 

m a y h a ve to pla y a m ore pro-active 

role h en ceforth . It h a s be en s u red 

th a t th e prom oters do n ot fa il yet 

a ga in in th eir du ty to p u t th e 

Com pa n y ba ck on ra ils . 

(b) As m en tion ed ea rlier, th e BIFR 

7

S.No. 

High Court 

& W.P.No. 

2. Hon ble 

High Cou rt 

of Kerala 

Writ 

Petition No. 

12576/07 

3. Hon ble 

High Cou rt 

of 

An dh ra 

Pradesh 

Filed by 

S.Mon y & 

Ors . On 

beh a lf of 

Retired 

Emp. 

Association 

(a) Volta 

Im pex Ltd. 

(Bidder for 

Hyderabad 

Division) 

WP 

No.3369/07 

(b) GVK 

Ltd. 

(GVK wa s 

a ls o a 

bidder a t 

th e la s t 

stage) 

WP No 

19189/07 

Case No.93/1987 



Court 

s h a ll keep a clos e wa tch of th e 

fu n ction in g of th e Com pa n y. It s h a ll 

be en s u red th a t th e Prom oters do 

n ot a llow th e Com pa n y to go in to 

ru in s . 

Th e Writ Petition h a s been 

dis m is s ed with direction th a t th e 

du es of th es e em ployees will be 

ta ken in to a ccou n t in th e 

Rehabilitation Scheme. 

(A) Filed with pra yer to s et a s ide th e 

AAIFR order da ted 6.2.2007. Th e 

Hon ble High Cou rt of An dh ra 

Pra des h vide order da ted 30.4.2007 

ordered th a t a n y Reh a bilita tion 

Sch em e filed by th e Prom oter will 

n ot be fin a lized by th e BIFR u pto 

10.6.2007. 

(B) Filed with pra yer to s et a s ide th e 

AAIFR order da ted 6.2.2007. Th is 

m a tter h a s been ta gged u p with th e 

WP No.3369/07. 

4. Hon ble 

High Cou rt 

Alind 

Workers 

Filed by Un ion for crys ta lliza tion of 

th eir du es a n d in corpora tion of th e 

8

Case No.93/1987 


S.No. 

High Court 

& W.P.No. 

of Orissa 

Filed by 

Union, 


Court 

s a m e in Reh a bilita tion Sch em e. Th e 

Hirakund 

Hon ble High Cou rt vide order da ted 

21.6.07 directed th a t Oppos ite 

Pa rty No.4 ( Un ited Sh ippers Ltd ) 

s h a ll n ot produ ce th e Sch em e before 

BIFR with ou t th e lea ve of th is 

Cou rt . 

8.2. Th e Ben ch is s u ed th e followin g direction s in th e h ea rin g h eld on 

10.7.2008:- 

(i) Th e Com pa n y s h a ll s u bm it copy of a ll th e orders pa s s ed by th e 

Hon ble High Cou rts to Boa rd a n d copy to Op era tin g Agen cy a n d 

secured creditors. 

(ii) Th e Com pa n y s h a ll crys ta llize th e du es of workers of a ll u n its 

separately clearly indicating head wise and category wise in respect of 

present and retired employees. 

(iii) Th e Com pa n y s h a ll m a ke a ll efforts to s ettle th e s ta tu tory du es a n d 

dues of the workers on priority basis. 

(iv) Th e Com pa n y s h a ll forwa rd th e Dra ft Reh a bilita tion Sch em e in 

res pect of a ll u n its except Hira ku n d divis ion wh ich m a y be filed with 

permission of the Hon ble High Cou rt of Oris s a . 

(v) Th e Com pa n y s h a ll ca rry ou t va lu a tion of its a s s ets th rou gh a n 

a pproved va lu er a ppoin ted by th e Sta te Ba n k of Tra va n core with in a 

m on th a n d s u bm it a copy of th e s a m e to Boa rd a n d s ecu red 

creditors. 

(vi) Th e Com pa n y is on ce a ga in directed u / s . 22 of Sick In du s tria l 

Com pa n ies (Specia l Provis ion s ) Act, 1985 n ot to dis pos ed of, a lin a te 

or lea s e a n y fixed a s s ets , la n d, bu ildin g, Pla n t a n d Ma ch in ery 

without the consent of BIFR. 

(vii) Th e Opera tin g Agen cy (Sta te Ba n k of Tra va n core) s h a ll exa m in e a ll 

th e docu m en ts / eviden ces to a s certa in a s to wh eth er a n y a ction is 

9

Case No.93/1987 


requ ired to be u n derta ken a ga in s t th e Com pa n y u n der s ection 24 of 

SICA for m is fea s a n ce, m a lfea s a n ce, brea ch of tru s t on th e ba s is of 

com pla in ts filed by workers u n ion a n d oth ers , a n d s u bm it its report 

to the Board within 6 weeks. 

(viii) Th e Boa rd will a p poin t 3 profes s ion a l directors for th e Com pa n y, 

(ix) 

wh o 

will a ls o exa m in e a ll th e fa cts a n d circu m s ta n ces of th e ca s e 

a n d s u bm it th eir report to th e Boa rd for ea rly reviva l of th e Com pa n y 

within 2 months. 

Th e Opera tin g Agen cy s h a ll exa m in e a n y Dra ft Reh a bilita tion Sch em e 

proposal in respect of 5 units except Hirkund division and submit the 

same to the Board for further necessary action in due course. 

8.3 Th e Boa rd vide order da ted 24.9.08 is s u ed a corrigen du m to th e 

proceedings of the hearing held on 10.7.08. 

9. In th e h ea rin g h eld on 21.4.09, th e Ben ch is s u ed th e followin g 

directions :- 

(i) Th e com pa n y s h a ll s u bm it a fu lly tied u p DRS a fter obta in in g th e 

con s en t of th e s ecu red creditors for OTS to Sta te Ba n k of 

Tra va n core (SBT)(OA) with in a period of 3 m on th s a s u n derta ken 

by th e com pa n y in th e h ea rin g toda y. Th e com pa n y a n d its 

prom oters a re pu t on n otice th a t u n les s a fu lly tied u p DRS is 

received by th e Boa rd with in th ree m on th s , th e Ben ch m a y 

exa m in e oth er option s u n der SICA in clu din g ch a n ge of 

m a n a gem en t in th e n ext h ea rin g a s th e referen ce of th e com pa n y 

has been pending with BIFR since 1987. 

(ii) M/ s . Pridh vi As s et Recon s tru ction a n d Secu ritiza tion Co. Ltd. 

(PARAS) s h ou ld s en d a copy of th eir im plea dm en t a pplica tion 

da ted 28.11.2008 to th e com pa n y u n der copy to th e OA (SBT) 

with in a period of 15 da ys . Th e com p a n y m a y file th eir rejoin der 

with in a n oth er 15 da ys u n der copy to th e OA (SBT) a n d PARAS. 

The company should specifically state their legal objections, if any, 

10

(iii) 

(iv) 

(v) 

(vi) 

Case No.93/1987 


to a s s ign m en t of debt to PARAS, a n ARC qu otin g th e releva n t 

provisions of law. 

Th e com pa n y s h a ll s u bm it th e orders , if a n y, pa s s ed by th e 

Hon ble High Cou rts of An dh ra Pra des h , Oris s a , Kera la a n d 

Hon ble Su prem e Cou rt of In dia from tim e to tim e. A copy of th is 

should be sent to SBT (OA) as well. 

Th e com pa n y s h a ll pa y a n OA fee of RS. 5 la kh plu s s ervice ta x 

and reimburse out of pocket expenses to the OA (SBT). 50% of the 

fee s h a ll be pa id with in 15 d a ys a n d th e ba la n ce m a y be pa id a t 

the time of submission of DRS by the OA. 

Th e com pa n y s h a ll s u bm it copies of th e s ettlem en t en tered in to 

with th e workers of a ll th e u n its to th e OA (SBT) with in a period of 

15 days. 

Th e com pa n y s h a ll s u bm it a lis t of u n s ecu red creditors in dica tin g 

the principal amount and the amount payable to them in the DRS. 

(vii) SBT (OA) s h a ll exa m in e th e DRS s u bm itted by th e com pa n y, 

con du ct a join t m eetin g of a ll s ecu red creditors a n d Govern m en t 

Agen cies in volved a n d s u b m it a fu lly tie du p DRS with in on e 

m on th on receipt of th e DRS from th e com pa n y, if it em erges , for 

a ll th e u n its of th e com pa n y ta kin g in to a ccou n t th e du es of th e 

s ecu red creditors , workers a n d s ta tu tory a u th orities a n d oth er 

creditors. 

(viii) M/ s . Vija y Electrica ls Ltd. s h ou ld n ot a tten d fu tu re h ea rin g a s 

(ix) 

(x) 

th ey a re on ly a pros pective bidder a n d th ere is n o ch a n ge of 

management ordered in the case. 

SBT (OA) shall forward a copy of the valuation report on the assets 

of th e com pa n y a s directed in th e h ea rin g h eld on 10.7.2008 (Ref. 

pa ra 8.2(v) of th es e proceedin gs ) a n d in form th e Boa rd th e n a m e 

of th e a s s ign ee of SBT s debt for Rs . 22 crore. 

Th e com pa n y s h a ll s u bm it its a u dited ba la n ce s h eet a s on 

31.3.2009 to SBT (OA) u n der copy to a ll s ecu red creditors a n d 

BIFR alongwith the DRS. 

(xi) The next hearing in the case will be held on 29.9.2009. 

11

Case No.93/1987 


10.1 A Mis c. Applica tion da ted 17.8.2009 h a vin g regis tra tion No. 

104/ BC/ 09 h a s been filed by M/ s . Prith vi As s et Recon s tru ction a n d 

Secu ritis a tion Com pa n y Ltd. (PARAS), wh erein it h a s been s ta ted th a t Ba n k 

of Ba roda , a s ecu red creditor, vid e a n As s ign m en t Agreem en t da ted 

1.10.2008 a s s ign ed a ll its debts du e from th e com pa n y a lon g with th e 

com pa n y s a s s ets to th e a pplica n t ARC, wh o is n ow en titled to ta ke a ll a n d 

every a ction to recover th e a m ou n t du e from M/ s .Alu m in iu m In du s tries Ltd. 

(AIL). It h a s been fu rth er s ta ted th a t Sta te Ba n k of Tra va n core (OA) is a ls o 

on e of th e s ecu red creditors of th e s ick com pa n y a n d th e com pa n y h a s 

s ettled th eir ou ts ta n din g du es to SBT u n der On e Tim e Settlem en t (OTS). 

However, Sta te Ba n k of Tra va n core h a s tra n s ferred th e s a id extin gu is h ed 

lia bility a n d th e secu rities to a th ird pa rty i.e. Kota k Ma h in dra Ba n k Ltd. 

u n der th e gu is e of a n a s s ign m en t, wh ich is n ot perm is s ible u n der th e 

Tra n s fer of Property Act. Sta te Ba n k of Tra va n core h as also not provided the 

va lu a tion of th e com pa n y s a s s ets des pite in s tru ction s by th e BIFR. An 

a ppropria te va lu a tion is , th erefore, es s en tia l for determ in a tion of th e is s u es 

pen din g before th e Boa rd. Th e a pplica n t ARC (PARAS) h a s pra yed in th e 

M.A. for the following:- 

i) To direct th a t th e th ird pa rty tra n s feree i.e. Kota k Ma h in dra Ba n k Ltd . is 

not a secured creditor. 

ii) To appoint an independent Government approved reputed valuer to value 

the assets of the company. 

10.2 In th e Mis c. Applica tion (No.104/ 2009) h ea rin g h eld on 15.9.09 to 

con s ider th e M.A., th e Ben ch directed th a t th e M.A. will be h ea rd with th e 

m a in ca s e fixed for h ea rin g on 29.9.09. M/ s .PARAS s h a ll s erve a copy of 

th eir M.A. on a ll th e con cern ed pa rties in clu din g KMBL a n d Ba n k of 

Baroda. 

11. In th e h ea rin g h eld on 22.12.09, the Bench obs erved th at th e 

com pan y h ad obtained cons en t of arou nd 60% of its s ecured cred itors . The 

com pan y h ad y et to s ettle w ith PNB, Can ara Ban k and PARAS , repres en ting 

12

Case No.93/1987 


around 40% of the s ecured loan ou ts tan d ing agains t th e com pan y . 

Bench issued the following directions:- 

Th e 

(a) Sin ce a bou t 60% of th e debt of s ecu red creditors h a s been s ettled 

/ a re s u pportin g th e DRS, PNB, Ca n a ra Ba n k a n d BOB/ PARAS a re directed 

to recon s ider th e Com pa n y s offer of s ettlem en t at 100% of its prin ciple 

du es , a t pa r with th e m a jority s ecu red creditors in clu din g KMBL wh ich h a s 

43.44% of the total secured loan outstanding. In case they are unable to do 

so, and a viable DRS emerges, their dues wou ld, a s in oth er s im ila r ca s es , 

be recovered at the end of the rehabilitation scheme. 

(b) SBT (OA) to con ven e a m eetin g of repres en ta tives of workers a n d th e 

com pa n y on 19.1.2010 a t 1 1.00 A.M. a t its Hydera ba d office / Bra n ch . 

On e worker s union would depute one worker. 

(c) SBT (OA) to get a fres h va lu a tion of th e com pa n y s en tire a s s ets 

conducted by a repu ted va lu er a n d a n d s u bm its its report with in s ix weeks 

to the Board with a copy to the company and the secured creditors. 

(d) Th e com pa n y to s u bm it its revis ed DRS in corpora tin g s ettlem en ts 

with th e s ecu red creditors , workers a n d th e reliefs a n d con ces s ion s s ou gh t 

from th e s ta tu tory a u th orities with in two m on th s to SBT (OA) a n d th e 

Board. If need be, the company may consider disposal of its surplus assets 

for revival. 

(e) SBT (OA) to con s ider th e com pa n y s DRS in a join t m eetin g of a ll 

concerned a n d s u bm it its report a lon gwith a fu lly tied u p DRS, if it 

emerges, within further one month to the Board. 

(f) Pu rs u a n t to th e Hon ble AAIFR order da ted 8.12.2009, M/ s . Vija y 

Electrica l Ltd. are perm itted to a tten d th e h ea rin g. For th eir im plea dm en t, 

to a wa it th e ou tcom e of th e h ea rin g in th e Hon b le AAIFR. 

(g) Th e com pa n y s h a ll s u bm it a propos a l in 15 da ys th rou gh th e OA for 

gra n tin g in terim relief to th e retired pers on n el, wh ich a re th e wors t hit 

a m on g th e la bou r a n d s ta ff. Th e s ta tu tory du es of la bou r h a ve a ls o to be 

remitted expeditiously. 

(h) PARAS to file its rejoin der to th e s u bm is s ion s m a de by th e com pa n y 

within 3 days to the Board with copy to OA and the company. 

13

Case No.93/1987 


(i) Th e n ext h ea rin g in th e ca s e wou ld be h eld on 23.3.2010 a t 11.00 

A.M. 

12.1 M/ s Pridh vi As s et Recon s tru ction a n d Secu ritis a tion Com pa n y Ltd 

(PARAS) h a s filed a n Mis c. Applica tion regis tered vide No.124/ BC/ 2010 

da ted 26.02.2010 pra yin g th e followin g direction s (a ) direct th e Regis try to 

lis t th e a pplica tion of PARAS for h ea rin g a t th e ea rlies t pos s ible da te. (b) 

direct th e Regis try to is s u e n otice to M/ s Alu m in iu m In du s tries Ltd a n d 

their Counsel for the date of hearing, so fixed. 

12.2 In th e Mis c. Applica tion (No.124/ 2010) h ea rin g h eld on 09.03.2010, 

the Bench issued the following directions :- 

(a) A Sh ow Ca u s e Notice (SCN) is h ereby is s u ed to PARAS a s to 

wh y cos t s h ou ld n ot be im pos ed on th em for th eir a bs en ce in toda y s 

h ea rin g, retu rn a ble with in a week s tim e. Hea rin g of it be clu bbed 

with the main case. 

(b) The MA is dismissed for non-prosecution. 

13.1 Sh ri Vija y Ku m a r, Advoca te on beh a lf of M/ s Pridh vi As s et 

Recon s tru ction a n d Secu ritis a tion Co. Ltd filed a n Mis c. Applica tion 

regis tered in BC Section vide No.399/ BC/ 2010, m a de th e followin g pra yer. 

(a ) Direct th e regis try to lis t th e a pplica tion of M/ s Pridh vi As s et 

Recon s tru ction a n d Secu ritis a tion Com pa n y Ltd for s u bs titu tion , a t th e 

earliest possible date. 

(b) Direct th e Regis try to is s u e n otice to M/ s Alu m in iu m In du s tries Ltd 

for the date of hearing so fixed. 

(c) Pa s s a n y s u ch fu rth er order (s ), direction (s ), a n d / or relief (s ) th a t 

th e lea rn ed Secreta ry, BIFR d eem s fit in th e fa ct a n d circu m s ta n ces of th e 

case and in the interest of justice. 

13.2 In th e Mis c. Applica tion (No.399/ 2010) h ea rin g h eld on 25.06.2010, 

th e Ben ch directed th a t th e Mis c. Applica tion No.399/ 2010 m a y be lis ted 

alongwith the main case in August, 2010. 

14

Case No.93/1987 


14. In th e h ea rin g h eld on 9.8.2010, th e Ben ch is s u ed th e followin g 

directions: 

i) M/s. PARAS impleaded as a necessary party in this matter. The name 

of PARAS s h a ll be in clu ded in th e m a ilin g lis t of th is ca s e. PARAS s h a ll file 

certified copy of certifica te for regis tra tion with Res erve Ba n k of In dia a s 

a greed in toda y s h ea rin g. Th e MA filed by PARAS for im plea dm en t s ta n d 

disposed of. 

ii) Sta te Ba n k of Tra va n core (Opera tin g Agen cy) s h a ll file a copy of 

va lu a tion report ca rried ou t by th e Ba n k a lon gwith ea rlier va lu a tion report 

ca rried ou t in 2007 a n d rea s on s for deprecia tion of a s s ets with referen ce to 

ea rlier report. Th e copy of th e va lu a tion report s h a ll a ls o be en dors ed to a ll 

the secured creditor. 

iii) Sta te Ba n k of Tra va n core (Opera tin g Agen cy) s h a ll work ou t th e 

percen ta ge of s ecu red creditor s ettled a n d th e percen ta ge of th e rem a in in g 

secured creditor yet to be settled. 

iv) Sh ow Ca u s e Notice (SCN) is h ereby is s u ed to com pa n y retu rn a ble 

with in on e m on th a s to wh y Ch a n ge of Ma n a gem en t s h ou ld n ot be ordered 

in th is ca s e a s th e com pa n y h a s fa iled to s ettle th e s ecu red creditor a n d to 

file the fully tied draft rehabilitation scheme. 

v) Com pa n y s h a ll con s ider relea s in g in terim relief to a ll its workers 

in clu din g th e retired em ployees a s a greed in toda y h ea rin g with in th ree 

week. 

vi) The Com pa n y s h a ll n egotia te with th e rem a in in g secu red creditor and 

th erea fter fu lly tied u p dra ft reh a bilita tion s ch em e with th e Op era tin g 

Agency and copy to Board within two months. 

vii) Th e du es of Ea s t Coa s t Meta l & Min era ls (P) Ltd. will be con s idered a t 

the time of sanctioned scheme. 

viii) Ca n a ra Ba n k s h a ll file its com m en ts on th e va lu a tion reports ca rried 

ou t by th e Sta te Ba n k of Tra va n core a s a greed in toda y s h ea rin g with in a 

month time. 

15

ix) 

Case No.93/1987 


Govern m en t of Kera la s h a ll file its com m en ts a s to wh eth er a ll th e 

u n its a re bein g con s idered for ta keover or on ly th e u n its loca ted in Sta te of 

Kerala as well its stand regarding takeover of the company. 

x) M/ s . Volta s Im pex Ltd s h a ll file th e copy of orders pa s s ed by th e 

Appella te Au th ority for In du s tria l & Fin a n cia l Recon s tru ction , Hon 'ble High 

Court and Hon'ble Supreme Court with the Board within one month. 

xi) Em ployees Sta te In s u ra n ce Corpora tion s h a ll file its written 

s u bm is s ion a bou t th e deta ils of ou ts ta n din g du es with brea k u p of th e 

same. 

xii) Com pa n y a n d Opera tin g Agen cy s h a ll a llow Sh ri S.J oh n s on , 

Conven er, ALIND Workers Sa m ra ksh n a Sa m ith i, Ku n da ra , Kola m Dis tt. to 

a tten d a ll m eetin g with th e m a n a gem en t on th e is s u e of s ettlem en t of du es 

a s per orders of Hon 'ble High Cou rt of Kera la da ted 15.3.2010 a n d 

26.5.2010 in Writ Petition No.8469/2010. 

xiii) 

The n a m e of Sh ri S.J oh n s on , Con ven er, ALIND Workers Sa m ra ks h n a 

Sa m ith i, Ku n da ra , Kola m Dis tt. m a y be in clu ded in th e m a ilin g lis t of BIFR 

for is s u a n ce of a ll fu tu re n otices a n d Record of Proceedin gs a s pra yed by 

him in his written submission dated 25.2.2010. 

xiv) 

M/ s . Volta s Im pex Ltd s h a ll th eir a pplica tion for im plea dm en t a s a 

party in this case with a copy to the company within one month. 

xv) The Bench fixed the next date of hearing on 21.10.2010. 

15. A Mis c. Applica tion No.595/ 2010 filed by M/ s Volta s Im pex Ltd., 

wh ich wa s h ea rd on 22.10.2010, wh erein th e Ben ch is s u ed th e followin g 

directions: 

i) M/ s Volta s Im pex Pvt Ltd to provide a copy of Mis c. Applica tion to 

Canara Bank. 

ii) Th e s ick com pa n y is directed to be pres en t in th e n ext h ea rin g a n d is 

allowed to s u bm it its res pon s e to th is a pplica tion for im plea dm en t 

within 4 weeks. 

iii) Th e Mis c. Applica tion No.595/ 2010 will be h ea rd a lon gwith th e m a in 

case scheduled to be held on 03.01.2011. 

16

Case No.93/1987 


16. Hea rin g for 03.01.2011 wa s res ch edu led for 03.02.2 011. The 

proceedin gs of th e h ea rin g h eld on 3.2.2011 cou ld n ot be is s u ed a s on e of 

the Members of the Bench had retired. 

17. Th e Ben ch fu rth er obs erved th a t SOP for th e h ea rin g h eld on 

21.02.2011 a n d 03.02.2011 cou ld n ot be is s u ed du e to a dm in is tra tive 

reasons. 

18.1 In th e h ea rin g h eld on 27.04.2011, the Bench apprais ed all th e s tak e- 

hold ers of th e com pan y pres en t in the hearing th at th e las t h earing in th is 

cas e w as held on 03.02.2011 and th e S OP of the hearing d ated 03.02.2011 

could not be is s ued d ue to ad m in is trative reas ons . S ubs equen tly th ere w as 

an Hon ble AAIFR Ord er d ated 31.01.2011, an d Hon ble AAIFR being a 

s uperior au thority to B IFR, BIFR h as to follow th e d irection of Hon ble AAIFR. 

Hon ble AAIFR vid e Ord er d ated 31.01.2011 obs erved th at . (from para 14) 

w e allow the appeal to th is exten t th at before the exis tin g m an agem en t of the 

com pan y s ubm its a fully tied -up revival propos al, the fin ancial and oth er 

affairs of th e com pany of the las t ten y ears s hould be inves tigated by a 

S pecial In ves tigative Aud it (S IA) to be cond ucted by an in d epend en t firm of 

ch artered accountan ts through th e Operatin g Agency (OA) w ith in 3 m on th s . 

The report of S IA s h ould be th oroughly exam in ed by OA; an d th e view s of the 

s ecured cred itors an d oth er concerned agencies s hould be obtained w ithin th e 

next one m on th. On th e bas is of the S IA report and th e view s of th e OA an d 

other concerned agencies , BIFR m ay pas s a s pecific reas oned ord er on th e 

application of ECMMPL (M/ s Eas t Coas t Metals & Minerals Pvt. Ltd .) m ad e 

und er s ection 24 of S ICA. If on th e bas is of the S IA report, BIFR com es to th e 

conclus ion th at a viable revival s chem e is feas ible u nd er the exis ting 

m an agem en t, only th en th e later m ay be as k ed to s ubm it a fully tied -up 

revival propos al for th e com pan y w ith in a m on th thereafter an d BIFR s hould 

17

Case No.93/1987 


th en tak e appropriate action in accord an ce w ith law . If on the bas is of the S IA 

report an d the com m en ts of OA and other concerned agencies , th e exis tin g 

m an agem en t is not cons id ered tru s tw orth y an d capable of und ertak ing the 

revival of the com pan y or the com pany fails to s ubm it a cred ible revival 

propos al exactly w ithin th e given tim e, B IFR s hould explore th e pos s ibility of 

revival th rough change of m an agem en t. While exploring ch ange of 

m an agem en t an opportunity to the w ork ers unions s hould als o be given, 

am on g others . 

We als o d irect th at u nd er s ection 22A of S ICA, th e exis tin g 

m an agem en t w ill not d is pos e of any as s ets of the com pan y till a fin al d ecis ion 

is tak en by th e BIFR. If revival is not con s id ered feas ible th rough any of thes e 

rou tes , BIFR m ay tak e appropriate action for w in d ing up of th e com pan y in 

accord an ce w ith law . 

Thus , Hon ble AAIFR, s et as id e th e part of the 

im pugned ord er of BIFR d ated 21.04.2009 as relates to s ubm is s ion of DRS by 

th e com pany and rem an d ed the cas e to BIFR w ith th e afores aid d irections for 

com pliance. S ince this cas e is lingering on und er S ICA for a very long tim e 

s ince 1987, Hon ble AAIFR d irect th at BIFR s hould hear th e cas e on w eek ly 

bas is w ith ou t any long ad journ m en ts and d ecid e th e m atter pos itively w ith in 

s ix m on th s from th e d ate of is s ue of th is ord er. 

A copy of th is ord er be 

forw ard ed to the B IFR im m ed iately an d parties are d irected to appear before 

BIFR on 21.02.2011. 

18.2 The Bench obs erved th at parties pres en t in th e hearing had heard the 

d irections of Hon ble AAIFR. The Bench als o obs erved th at th e Appeal 

(No.138/ 2 009) filed by M/ s Vijay Electricals Ltd (VEL) h as als o been 

d is m is s ed by Hon ble AAIFR, accord ingly , th e n am e of M/ s VEL is d eleted 

from th e lis t of parties . Ha vin g con s idered th e s u bm is s ion s m a de in th e 

hearing and material on record, the Bench issued the following directions :- 

(a) 

Sta te Ba n k of Tra va n core (OA) is d irected to get a Specia l 

In ves tiga tive Au dit (SIA) con du cted on th e a ffa irs of th e Com pa n y for 

18

Case No.93/1987 


the la s t 10 yea rs . SIA s h ou ld be con du cted by a n in depen den t firm of 

Ch a rtered Accou n ta n t, wh o a re a lrea dy on th e pa n el of SBT (OA). Th e 

rem u n era tion of CA will be a s per th e Ba n ks s ta n da rd ra te. Th e cos t 

of a ppoin tm en t of CA to con d u ct SIA will be born e by th e Com pa n y. 

SBT (OA) is directed to com plete SIA with in a period of (03) th ree 

m on th s a n d s u bm it its report to th e Boa rd with copy to th e Com pa n y, 

and all its secured creditors. 

(b) SBT (OA) is also directed to obtain the relevant information from 

earlier m a n a gem en t of th e com pa n y s a ffa irs du rin g th eir ten u re prior 

to 2007 i.e before th e in du ction of pres en t m a n a gem en t viz Som a n i 

Grou p. Th e Com pan y s h ou ld a ls o exten d a ll its s u pport to SBT (OA) 

a n d in ca s e th e com pa n y does n ot co-opera te, SBT (OA) is directed to 

approach the Board and seek further direction. 

(c) All th e s ecu red creditors of th e com pan y a re directed to s u bm it 

their suggestion / objections on the report of SIA to the Board within a 

further period of 10 days, with copy to SBT (OA). 

(d) 

SBT (OA) is fu rth er directed to s u bm it a con s olida ted report on 

the views of secured creditors within a further period of three months. 

(e) Th e Com pa n y is directed th a t it m a y con s ider re-s ta rtin g th e 

opera tion a t Ku n d a ra u n it, a s des ired by va riou s workers in th e 

h ea rin g. Th e Com pa n y is a ls o directed th a t it m a y con s ider relea s in g 

interim relief to its workers, if any. 

(f) 

M/ s Vija y Electrica ls Ltd (VEL) is deleted from th e lis t of pa rties 

/ mailing list. 

(g) 

Ba n k of Ba roda is exem pted for a tten din g fu tu re h ea rin g in th is 

case. The name of Bank of Baroda be deleted from the mailing list. 

19

Case No.93/1987 


(h) The next date of hearing in this case is fixed on 15.09.2011. 

The hearing fixed for 15-09-2011 has been cancelled. 

19.1 In toda y s h ea rin g (30-01-2012), th e Ben ch n oted th a t a n u m ber of 

representatives from Workers Union a re pres en t in th e h ea rin g a n d 

announced th a t th e Ben ch will con s ider only th e views / com m en ts on th e 

Special Investigative Audit (SIA) report in toda y s h ea rin g. 

19.2 Th e repres en ta tive of SBT (OA) s ta ted th a t in com plia n ce of th e Ben ch 

direction s , Specia l In ves tiga tive Au dit (SIA) h a ve been con du cted by M/ s 

Loon ker & Co. A copy of th e s a m e wa s forwa rded to th e Boa rd s office on 

06-09-2011. Copies of SIA report wa s a ls o forwa rded to a ll th e secured 

creditors in Sep 2011, a s kin g th em to file th eir com m en ts on th e report 

with in a p eriod of 10 da ys . Th ree of th e s ecu red creditors viz PARAS, IDBI 

a n d CARE h a d filed th eir com m en ts . KMBL h a s a ls o provided its com m en ts 

toda y ju s t before th e h ea rin g. ICICI, Ca n a ra Ba n k a n d Pu n ja b Na tion a l 

Ba n k a re yet to s u bm it th eir com m en ts on SIA. Th e Ben ch en qu ired wh a t 

are discrepancies n oted in SIA, th e repres en ta tive of SBT (OA) s ta ted th a t 

th ey h a d n ot obs erved a n y divers ion of fu n ds by th e prom oters . Th e 

com pa n y h a s a ls o n ot crea ted a n y n ew ch a rges on th e fixed a s s ets of th e 

com pa n y du rin g th e la s t 10 yea rs . Th e com pa n y h a s n ot dis pos ed a n y pa rt 

of its fixed a s s ets . Th e com pa n y h a s defa u lted in repa ym en t of Deben tu res 

a n d redem ption of preferen ce s h a res . Th e repres en ta tive of SBT (OA) a dded 

th a t n o s evere la pses were fou n d in the Specia l In ves tiga tive Au dit (SIA) 

report. Th e Ben ch en qu ired wh eth er SBT (OA) h a d provided th e copy of SIA 

to th e com pa n y, th e repres en ta tive of OA (SBT) s ta ted th a t th ey h a d already 

provided th e s a m e in Sep 2011 its elf. Th e Ben ch th en en qu ired from th e 

com pa n y wh eth er th ey h a d filed th eir com m en ts on th e SIA report, th e 

Director of th e com pa n y s ta ted th a t th ey were n ot a wa re th a t th e com pany 

h a d to file its com m en ts , a n d requ es ted th e Ben ch to gra n t on e week s tim e 

for submitting their comments. 

20

Case No.93/1987 


19.3 Th e repres en ta tive of Ca n a ra Ba n k s ta ted th a t th ey h a d received SIA 

report from OA (SBT) and they have no comments to offer. 

19.4 Th e Ld. Advoca te repres en tin g Govt. of Kera la s ta ted th a t th ey have 

not received copy of the SIA report. The Bench directed OA (SBT) to provide 

a copy the report to Govt. of Kera la . Th e repres en ta tive of OA (SBT) s ta ted 

th a t h e will provide a copy toda y its elf. Th e Ld. Advoca te repres en tin g Govt. 

of Kera la requ es ted th e Ben ch to gra n t th ree weeks tim e to file th eir 

comments. 

19.5 Th e repres en ta tive of Pu n ja b Na tion a l Ba n k s ta ted th a t th e Ba n k will 

file its comments on SIA within a fortnight. 

19.6 Th e repres en ta tive of ICICI Ba n k s ta ted th a t th e Ba n k h a s n o 

comments on the SIA report. 

19.7 Th e repres en ta tive of Kota k Ma h in dra Ba n k s ta ted th a t th e Ba n k h a d 

already filed their comments on the SIA report. 

19.8 Th e Ld. Advoca te repres en tin g Pridh vi As s et Recon s tru ction & 

Secu ritis a tion Co. Ltd (PARAS) s ta ted th a t th ey h ave a lrea dy filed th eir 

com m en ts on SIA b efore th e Boa rd s office. He fu rth er s ta ted th a t a fres h 

chance be given to th e pres en t prom oters to pu t forth a n u pda ted a n d 

revised DRS for revival of the company and safeguard the interest of secured 

creditors and its workers. 

19.9 Th e repres en ta tives of Allu m in iu m In du s tries Em ployees Un ion , 

ALIND Steel Wire Pla n t Em ployees Un ion , Ku n dra Allu m in iu m Fa ctory 

Worker s Un ion , ALIND Em ployees Un ion Reviva l Com m ittee, ALIND Steel 

Pla n t Worker s Con gres s , ALIND Worker s Un ion (CITU), Alluminium 

In du s tries Con tra ct Workers Un ion , U. Elia zer Retd Em ployees Welfa re 

As s ocia tion a n d ALIND Switch gea r Em ployees As s ocia tion filed th eir written 

s u bm is s ion to th e Ben ch du rin g th e cou rs e of h ea rin g. Th e Ben ch directed 

21

Case No.93/1987 


Ben ch Officer to h a n d over a ll th e written s u bm is s ion s to OA (SBT) a n d 

directed OA (SBT) to file its comments/report to the Board within a period of 

two weeks. 

19.10 Th e Ld. Advoca te repres en tin g th e com pa n y s ta ted th a t a s per 

Specia l In ves tiga tive Au dit (SIA) report, th e a llega tion s of u n a u th orized s a les 

of assets a n d divers ion of fu n ds were ba s eles s a n d fa ls e. He a dded th a t 03 

(th ree) u n its of th e com pa n y viz. Ma n n a r, Triva n dru m a n d Hydera ba d a re 

opera tion a l. Th e com pa n y h a s a ch ieved a tu rn over of Rs .15.00 crores for 

th e cu rren t yea r. Th e com pa n y pres en tly em ploys 463 workers . Th e 

pres en t m a n a gem en t of th e com pa n y is in teres ted in revivin g a ll th e u n its of 

th e com pa n y with th e s u pport of BIFR, Govern m en t of Kera la a n d oth er 

s ta ke h olders . Th e com pa n y h a d a lrea dy filed th e DRS before th e Boa rd, 

h owever, it wa s n ot con s idered s o fa r, a n d th e prom oters a re rea dy to 

u pda te th e s a m e. Th e prom oters of th e com pa n y h a d dis cu s s ion s with 

Govern m en t of Kera la , wh o h a d a greed to s u pport th e pres en t prom oters for 

s ta rtin g opera tion of Ku n dra Un it. He requ es ted th e Ben ch to give a s h ort 

da te to th e pa rties wh o h a ve yet to file th eir com m en ts on Specia l 

Investigative Audit (SIA). 

19.11 The Special Commissioner from the office of Resident Commissioner, 

Govt. of Kera la (n ot s ign ed) s ta ted th a t th e Sta te Govern m en t h a d h eld a 

h igh level m eetin g a n d it wa s decided to s u pport th e exis tin g prom oters of 

th e com pa n y s u bject to s ta rtin g opera tion of Ku n dra u n it with in a s pecified 

period of time. 

19.12 The Bench obs erved th at the Un ions to file their com m en ts / objections if 

any on S pecial In ves tigative Aud it (S IA) to the Operatin g Agency (S tate Ban k 

of Travancore). 

20. Ha vin g con s idered th e s u bm is s ion s m a de in th e h ea rin g a n d m a teria l 

on record, the Bench issued the following directions:- 

22

(a) 

Case No.93/1987 


Govt. of Kera la to file its com m en ts on Specia l In ves tiga tive 

Au dit (SIA) to OA (SBT), with in a period of th ree weeks , a s a greed by 

th em in toda y s h ea rin g. 

(b) 

Th e com pa n y to file their com m en ts on Specia l In ves tiga tive 

Audit (SIA) to OA (SBT) within a period of one week. 

(c) Pu n ja b Na tion a l Ba n k to file its com m en ts on Specia l 

Investigative Audit (SIA) to OA (SBT) within a period of two weeks. 

(d) Th e u n ion s of th e com pa n y wh o wis h to file objection are 

directed to file th eir com m en ts on Specia l In ves tiga tive Au dit (SIA), if 

any, to OA (SBT) within a period of two weeks. Thereafter, OA (SBT) is 

directed to file a con s olida ted report to th e Board, with in a fu rth er 

period of two weeks. 

(e) The Bench fixed the next DOH on 28 Mar 2012. 

Let a copy of this order be circulated to all concerned. 

(Y. K. GAIHA) 

MEMBER 

(NIRMAL SINGH) 

CHAIRMAN 

23

1 board for industrial and financial reconstruction bench iii case no ...

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