case no. 501/1997 - Board for Industrial & Financial Reconstruction

Case No. 501/1997M/a Hindustan Antibiotics Ltds ta ted th a t th ere a re Ca pita l Ga in s , a s th e com pa n y h a s ch a rged wa iverinto profit and loss accounts. On a query from Bench, the representative ofcom pa n y a greed th a t th e com pa n y h a d booked wa iver of in teres t fromBa n k a n d Govt. in to profit a n d los s a ccou n ts of th e com pa n y in th e yea r2006 and thus the company in the year 2006 earned net profit.2.10 Th e repres en ta tive of Hin du s ta n An tibiotic Officer s As s ocia tion s a tedth a t th ere a re 300 officers a n d 900 em ployees in th e com pa n y. As on da teth ere is a n ou ts ta n din g du e of Rs .60.00 crores a ga in s t th e com pa n y ona ccou n t wa ge a rrea rs . On a qu ery from Ben ch , th e repres en ta tive ofcom pa n y s ta ted th a t in term s of decis ion of Govt., th e wa ge revis ion wa sa llowed in 2009, bu t effective from 2006 a n d th es e du es a re on ly preassumption,as there is no wage revision is allowed to any sick unit.2.11 On a qu ery from th e Ben ch a bou t th e s ta tu s of ASC, th e CMD of th ecom pa n y s ta ted th a t Boa rd of Directors of th e com pa n y h a d decided to gofor fres h va lu a tion of a s s ets . Th e Ben ch observed th a t ASC is th ecom peten t a u th ority to ta ke a decis ion on th e re-va lu a tion of a s s ets a n dth e decis ion of Boa rd of Directors of th e com pa n y to in terfere in th ein tern a l m a tter of ASC is grea t con cern , wh ich cou ld a ls o be term ed a sgros s viola tion of th e Ben ch Direction . Th e MD in ch a rge of th e com pa n ys ta ted th a t m a tter will be s orted ou t a t th e ea rlies t. On a qu ery from th eBen ch to th e repres en ta tive of Govt. of In dia (GOI), Deptt. ofPh a rm a ceu tica ls (DoP) a bou t th is is s u e wh ich h a s res u lted in a a b n orm a ldela y in ta kin g a decis ion , wh ich wa s cru cia l for th e reviva l of th ecompany, th e repres en ta tive of GOI s ta ted th a t h e will ta ke u p th is m a tterwith th e a u th ority a n d m a tter will be s orted in two m on th s . Th e Ben chobserved th a t CMD of th e com pa n y s h ou ld file a written s u bm is s ion with ina period of 15 da ys rega rdin g s ellin g of a s s ets a s a pproved by th e ASC, bu tit im plem en ted by CMD. Th e Ben ch fu rth er observed th a t h a d s a le h a dgon e a h ea d on tim e, th e com pa n y cou ld h a ve s ettled th e du es of itss ecu red creditors a n d s a les ta x depa rtm en t. Wh erea s , toda y, th e com pa n yis goin g to fa ce s h orta ge of workin g ca pita l, wh ich cou ld a ls o lea d toreduction in production or altogether stoppage of production.9