LPA No. 220 of 2008 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH -- LPA No. 220 of 2008 (O&M) Date of decision: August 26, 2009 B K Gupta ........ Petitioner Versus P.S.I.D.C. and others .......Respondent(s) Coram: Hon'ble Mr. Justice Adarsh Kumar Goel Hon'ble Ms Justice Nirmaljit Kaur -.- Present: Mr. Arun Palli, Senior Advocate with Mr. Tushar Sharma, Advocate for the appellant Mr. Arun Walia, Advocate for respondent No. 1 Mr. Mandeep S Bedi, Advocate with Ms Gauri Bedi, Advocate for respondent No. 5 Mr. Amit Goyal, Advocate for respondent No. 6 -.- 1. Whether Reporters of local papers may be allowed to see the judgement? 2. To be referred to the Reporter or not? 3. Whether the judgement should be reported in the Digest? Adarsh Kumar Goel , J . 1. This appeal has been filed against the judgement of the learned Single Judge, allowing the writ petition filed by respondent No. 1, on the ground of res judicata. LPA No. 220 of 2008 2 2. The appellant is a Promoter and Managing Director of Punjab Nitrates Limited (hereinafter referred to as 'the Company'). The Company filed a reference under Section 15 of the Sick Industrial Companies (Special Provisions) Act, 1985 (hereinafter referred to as '1985 Act') before the Board for Industrial and Financial Reconstruction (BIFR). The BIFR held that the reference was not maintainable on the ground that the Company had started production on 02.05.1989 and had not completed five years of commercial production by 01.04.1994 as required for maintainability of the reference under Section 15(1) of the 1985 Act. The Company preferred an appeal before the Appellate Authority for Industrial and Financial Reconstruction, New Delhi (AAIFR). The appeal was allowed by holding that the requirement of five years of commercial production was not a condition precedent for maintainability of the reference, in view of its earlier decision dated 01.08.1996 in Appeal No. 148 of 1995. The observations of the AAIFR are as under:- “As the BIFR rejected the appellant's reference under Section 15 (1) of the Act only on the ground of absence of commercial production for five years and as that ground is not sustainable in view of this Authority's decision dated 01.08.1996 in Appeals 148/95 etc., the case requires afresh consideration by BIFR. The appellants, PSIDC, and any other party will also be free to raise their other contentions before BIFR.” 3. Accordingly, the appeal was allowed and the matter was remanded to the BIFR for fresh decision. 4. Respondent No. 1 filed Civil Writ Petition, wherein the impugned order has been passed. Contention raised before learned Single Judge was that on an earlier occasion, the appellant had filed Civil Writ Petition No. 8946 of LPA No. 220 of 2008 3 1996, wherein, it was held that reference was not maintainable before the BIFR and this finding having been recorded by this Court, would operate as res judicata and the AAIFR could not have gone into the maintainability of the reference. This plea was accepted. The observations of learned Single Judge are as under:- “Learned counsel for the respondent has not disputed the fact that this Court had given a positive finding regarding the maintainability of the reference sought by the respondent No. 5.” 5. We have heard learned counsel for the parties. 6. Learned counsel for the appellant submits that reference to the earlier DB judgement dated 02.08.1996 (Annexure P3) shows that there is no finding recorded therein that reference before the BIFR was not maintainable and, therefore, there is an error on record in holding that there was such a finding, which debars the AAIFR from going into the question of maintainability of the reference. 7. Learned counsel for the contesting respondents have not been able to show any finding in the earlier Division Bench Judgement dated 02.08.1996 on the issue of maintainability of reference. 8. We have, thus, no option but to hold that the view taken by learned Single Judge that in the earlier Division Bench judgement, the issue of maintainability of reference before the BIFR had been concluded, is against the record. The issue in the earlier DB judgement was whether the appellant could invoke protection under Section 22 of the 1985 Act against proceedings taken by respondent No. 1 under Section 29 of the State Financial Corporation Act, 1951. This claim of the appellant was negatived. There is a reference in the said judgement that the BIFR had rejected the reference as not maintainable vide order dated 20.10.1995, which reference is while referring to the reply of respondent LPA No. 220 of 2008 4 No. 1 making averments to that effect. However, the question of validity of maintainability of reference was not put in issue before the Division Bench and only question was of the applicability of Section 22 of the 1985 Act to proceedings under Section 29 of the State Financial Corporation Act, 1951. 9. Accordingly, the appeal is allowed and the impugned order is set aside and the matter is remanded to learned Single Judge for fresh decision in accordance with law. Parties may appear before the learned Single Judge on 06.10.2009 for further proceedings. (Adarsh Kumar Goel) Judge (Nirmaljit Kaur) Judge August 26, 2009 mohan