M/s Madura Coats Limited vs M/s Modi Rubber Ltd. - Supreme Court Important
M/s Madura Coats Limited vs M/s Modi Rubber Ltd. - Supreme Court Important Judgment 2016 -
On 29th June, 2016, in the case of M/s Madura Coats Limited vs M/s Modi Rubber Ltd. & Anr. [Civil Appeal No. 1475 of 2006], a three Judges Bench held that “different situations can arise in the process of winding up a company under the Companies Act but whatever be the situation, whenever a reference is made to the Board of Industrial and Financial Reconstruction (BIFR) under Sections 15 and 16 of the Sick Industrial Companies (Special Provisions) Act, 1985 (SICA’), the provisions of the SICA would come into play and they would prevail over the provisions of the Companies Act and proceedings under the Companies Act must give way to proceedings under the SICA.”
Accordingly, the view taken by the High Court in concluding that the winding up proceedings before the Company Court cannot continue after a reference has been registered by the BIFR and an enquiry initiated under Section 16 of the SICA, was upheld.