Judgment A. N. Trivedi J. 1. Judgment A. N. Trivedi J. 1. The petitioner has prayed for quashing of the order dated 22-4-1992 (Aimexure-1) passed by the board for Industrial and Financial reconstruction (for short BIFR-Respondent No.1) in Case No.249 of 1987 by which BIFR directed its opinion to be forwarded to this Court in terms of Sec.20 of the Sick Industrial companies (Special Provisions) Act, 1985 (for short the Act) for further necessary action according to law and also the order dated 15-9-1993 (Annexure-2) passed by the Appellate authority for Industrial and Financial reconstruction (for short the Appellate authority - Respondent No.2) by which the petitioners Appeal was dismissed and has further prayed for an appropriate writ commanding respondents 1 and 2 to prepare a fresh rehabilitation scheme in the light of the new Industrial policy of the State of bihar and the rehabilitation proposal of the petitioner with the assistance of industrial Financial Corporation of India (for short IFCI-Respondent No.14) and has also prayed for appropriate writ commanding the State Bank of India for short S. B. I.) and the Allahabad Bank, respondents 4 and 5 and the financial institutions, namely, the Bihar State financial Corporation (for short b. S. F. C.- Respondent No.3), Industrial development Bank of India (for short i. D. B. I.- Respondent No.9), the industrial Reconstruction Bank of India (for short I. R. B. I.- Respondent No.10)and the Bihar State Credit and investment Corporation Limited (for short b. S. C. I. Co - Respondent No.11) for waiver of the entire interest including compound interest and penal rent of interest and to command the S. B. I, to provide working capital and margin money for meeting the working capital requirement and to direct the Bihar State industrial Development Corporation limited (for short the B. S. I. D. C.-Respondent No.12) to dispense with the unreasonable conditions imposed by it by insisting upon the petitioner to repurchase the equity share under written by the B. S. I. D. C. and also to waive any such interest accrued as a consequence thereof and the Bihar State electricity Board (for short the B. S. E. B. Respondent No.15) for reconnection of the electricity supply to the petition without making supply to the petitioner without making the petitioner liable for payment of Annual Minimum guarantee for the notice period and that the state of Bihar-Respondent No.6 be directed to provide full exemption of sales-tax for a minimum period of 10 years as per the new Industrial Policy of the State. 2. The State and the B. S. F. C. have supported the case of the petitioner but the remaining Institutions and the banks have opposed the writ petition. 3. The contention of learned counsel for the petitioner is that the object of the Act is to afford maximum protection of employment, optimise the use of funds etc. , salvaging the production assets, realising the amounts due to the Banks etc, and to replace the existing time-consuming and inadequate machinery by efficient machinery for expeditious determination by a body of experts and the Act has been enacted to safeguard the economy of the nation and to protect viable sick units and is aimed at reviving and rehabilitation sick industries. The other contention of learned Counsel for the petitioner is that though the policy of the State government and the reliefs and concessions granted by the State Government had been communicated to the appellate Authority during the pendency of the Appeal yet the same had not been taken note of and in ignorance of the reliefs and concessions and the industrial Policy of the State Government the Appeal had been arbitrarily dismissed. 4. Learned Counsel for the respondents, except the State and the B. S. F. C. , has stated at the Bar that none of the financial Institutions and the Banks are willing to provide any further financial assistance to the petitioner for the purposes of its rehabilitation as according to the said respondents the rehabilitation of the petitioner is not possible despite all efforts made by them. 5. Having heard learned Counsel for the parties and having considered the material on record, I am of the opinion that there is no merit in the writ-petition and it is liable to be dismissed. 6. 5. Having heard learned Counsel for the parties and having considered the material on record, I am of the opinion that there is no merit in the writ-petition and it is liable to be dismissed. 6. The petitioner was granted an industrial licence for manufacture of 50 tonnes of Vanaspati Ghee per day at hathwa, district Gopalganj, which is said to be one of the backward districts in the State of Bihar and on account of various difficulties and delay at the instance of the financial Institutions and the Banks and the B. S. E. B. The petitioner suffered losses as a result of which there was erosion of margin money and in course of time the petitioner became a Sick Industrial company within the meaning of clause (d) of sub-section (1) of section 3 of the act and since the financial Institutions/banks, the State Government and the Civil Supplies Department of the union of India have not been cooperating for timely help to the petitioner, it made a reference under sub-section (1)of Sec.15 of the Act on 30-7-1987 (Annexure-4) requesting the B. I. F. R. for determination of measures to be adopted with respect to the petitioner. The B. I. F. R. by its order dated 25-4-1988 (Annexure-5) decided to appoint a special director under Sec.16 (4) of the Act for safeguarding the Companys financial and other interests and also directed the I. F. C. I. , the lead institution, to prepare a rehabilitation package that had been agreed to in principle by the financial institutions/banks and the state Government in their joint meeting held in December, 1987 and IFCI asked to rework out the financial data after receiving the advice from the State government regarding the quantum, date of release and terms and conditions of the margin loans, which the Government representatives had agreed would be extended to the petitioner in course of the discussions between the institutions and the Government representatives held in December, 1987. The b. I. F. R. in its proceedings dated 16-8-1988 (Annexure-6) noted that the i. F. C. I. has not been able to finalise the package for want of positive response from the State Government about its willingness to give margin money loan and the Government representatives stated that the State Government was in the process of laying down its policy for sick units and requested for and BIFR granted a months time to the State government to take a decision. On 22-1-1988 the representatives of the State government stated that the Government had agreed in principle to provide a loan of Rs.94 lacs but the terms and conditions of the loan had not been settled and a fortnights time was prayed for on behalf of the State Government. By the order dated 22-11-1988 (Annexure-7) the B. I. F. R. appointed I. F. C. I. as Operating Agency under Section 17 (3) of the Act to examine the viability and prepare a scheme of rehabilitation of the petitioner. The Operating Agency prepared a draft rehabilitation scheme on 26-6-1989 which was circulated and besides the reliefs/concessions from participating institutions/banks and promoters, the Operating Agency proposed the reliefs and concession from the State Government for grant of term loan of Rs.94 lacs towards margin money for working capital and certain reliefs in respect to sales-tax and for waiver of A. M. G. charges and the fuel surcharge from the B. S. E. B. The operating Agency on 30-8-1989 explained the main feature of the draft rehabilitation scheme and upon examination of the same B. I. F. R. directed the Operating agency to rework the draft scheme keeping in view the observations made in the order dated 30-8-1989 (Annexure-8 ). Accordingly a revised draft scheme was circulated by the operating agency on 12-1-1990 proposing the same reliefs/concessions as in the earlier scheme from the Institutions/banks with further proposals and suggestions. The representatives of the petitioner expressed willingness for acceptance of the draft scheme and the promotors also accepted the obligation imposed on them in the draft scheme but in absence of the representative of the State government the B. I. F. R. granted four weeks further time to the State government for giving its consent to the proposed reliefs/concessions by its order dated 22-3-1990 (Annexure-9)and the cut-off date was fixed as 30-6-1990. Eventually the State Government vide their letter dated 25-4-1990 (Annexure-10) indicated that the reliefs/concessions to be extended to the petitioner would provide 94 lacs margin money loan and deferment of sales-tax for 7 years subject to an overall ceiling of Rs.340 lacs. However, the State government did not agree to grant reliefs/concessions as proposed in the draft scheme for set otf of the purchase tax on raw materials for a period of 7 years and exemption from payment of excise duty on power for a period of 5 years and grant of subsidy. 7. Having examined the reliefs/concessions the Operating Agency informed the B. I. F. R. by letter dated 23-7-1990 (Annexure-11) that the viability of the rehabilitation of the company has become doubtful and in the proceedings held on 25-10-1990 the representatives of the State Government informed the B. I. F. R. that the matter of exemption of sales-tax was under consideration of the State government. The B. I. F. R. having examined the entire aspect of the matter came to the conclusion that the petitioner should be wound up so as to salvage as much as possible without any further delay and accordingly by the order dated 25-10-1990 (Annexure-12)directed notices to be issued to all concerned to show cause as to why the Sick industrial Company should not be wound up and fixed 9-1-1991 for further hearing. The B. I. F. R. further directed that in the meanwhile, interregnum may be utilised by the promotors to reconsider their decision in regard to their capability to organise funds as per the provisions of the scheme and as well as for funding the projected estimated cash losses upto 31-3-1991 and simultaneously the State Government was also asked to consider favourably the reliefs/concessions expected from them specially with regard to the exemption from sales-tax and the reliefs from the b. S. E. B. and the B. S. I. D. C. was asked to consider either to take over the unit as promotors or in association with some other entrepreneur who may be capable of inducting funds required for rehabilitating the company. 8. 8. The B. I. F. R. after hearing the petitioner and the other parties by the impugned order dated 22-4-1992 (Annexure-1) observed that a draft scheme was prepared for revival/rehabilitation of the petitioner and the extent of reliefs/concessions as communicated for acceptance by the State Government were found to be at variance vis-a-vis what was expected as per the provision of the draft scheme and on careful scrutiny of the State Governments responses, the B. I. F. R. came to the conclusion that the petitioners case had been found to be totally unviable and accordingly directed its opinion to be forwarded to this Court in terms of section 20 of the Act for further necessary action according to law. The petitioner then filed Appeal No.49 of 1992 before the Appellate Authority during the pendency of which the Additional development Commissioner, Government of bihar, by his letter dated 10-5-1993 (Annexure-25a) addressed to the Secretary of the Appellate Authority informed that the proposed New Industrial Policy for the following incentives/reliefs of the Vanaspati- Ghee units located in Bihar: "1. Exemption/deferment from Sales tax for a period 8 and 10 years has been given to the new Vanaspati Ghee units depending upon location of the units. It is upto the units to opt for exemption from sales Tax or deferment of Sales Tax scheme. The deferment of Sales Tax will be limited to 150% of the total fixed capital investment of the unit. The deferred amount under the scheme will be repaid in three equal annual instalments with a period of three years from the date of expiry of deferment period. State Government would consider providing similar reliefs/concessions to the sick and closed Vanaspati Ghee units if their rehabilitation package has been approved by BIFR/state Government. M/s Hathwa Vanaspati Ltd. is located in Gopalganj district which is in Category a illegible for. exemption from Sales Tax deferment of Sales Tax for 10 years.2. Exemption from Tax on purchase of raw materials, all existing units whose investment on plant and machinery is not more than 15 crores rupees as on 1-4-1993, are illegible for exemption from Tax for purchase of raw materials for a period of 7 years from 1-4-1993. It is once again reiterated that State government is very keen for early rehabilitation and reopening of M/s hathwa Vanaspati Ltd. , Gopalganj. It is once again reiterated that State government is very keen for early rehabilitation and reopening of M/s hathwa Vanaspati Ltd. , Gopalganj. You are therefore requested that in view of above Industrial Finance corporation of India, the Operating Agency, may be directed to rework the rehabilitation scheme of M/s Hathwa Vanaspati Ltd. in light of the new reliefs and concessions which the State Government may consider if the package gets approval from BIFFt. " 9. The grievance of the petitioner is that the said concessions and reliefs had not been taken into account by the appellate Authority while rejecting its Appeal. 10. During the pendency of the writ Petition the submission of learned counsel for the petitioner that the appellate Authority did not grant any relief and confirmed the order for winding up of the petitioner witnout taking into account the concessions/reliefs granted by the State Government and if the financial reliefs granted by the State government had been considered by the Appellate Authority there would have been possibilities of rehabilitation of the petitioners unit was considered and accordingly this Court by the order dated 21-9-1995 directed that: "it would be worthwhile to once more investigate whether there are any reasonable possibilities of rehabilitation of the Company in view of the offers of financial reliefs coming from the State government. For this purpose, it would be just and proper for all concerned to sit across a table and consider the possibilities of the petitioners rehabilitation in the light of the financial reliefs coming from the State Government. I, therefore, think that a meeting should be convened in which the operating agency, the Industrial Development bank of India and the other creditors of the petitioner should listen to the petitioner and its alies on the points raised by Mr. Chatterjee before this Court. The Industrial Development Bank of india is accordingly given the responsibility to convene a meeting at Patna by 31-10-1995. The necessary informations regarding the date, time and venue of the meeting should be communicated by the industrial Development Bank of India to the petitioner and to all other respondents. The State Government and its officials and the Bihar State Financial corporation are directed to fully cooperate and participate in this meeting. The necessary informations regarding the date, time and venue of the meeting should be communicated by the industrial Development Bank of India to the petitioner and to all other respondents. The State Government and its officials and the Bihar State Financial corporation are directed to fully cooperate and participate in this meeting. It is expected that the other respondents, financial institutions, having a stake in this matter would also attend the meeting with an open mind to objectively assess the petitioners chances for rehabilitation". 11. By another order dated 31-10-1995 the date for convening the meeting was extended till 15-12-1995. 12. In compliance of the direction issued by this Court the joint meeting of financial Institutions/banks/government department was held at IDBI, patna on 8-11-1995 which was presided by the General Manager, IDBI, Patna. Copy of the minutes of the meeting has been annexed as Annexure-A to the counter Affidavit filed by the IDBI, respondent No.9 on 3-1-1996, a perusal of which reveals that the representatives of the BSFC, SBI and the allahabad Bank stated that they were willing to support the proposal provided the units viability could be established. The representative of the BSEB expressed inability to reconsider restoration of power to the petitioner in view of mounting over-dues to the Board and the promoters who appeared later stated that they could sort out the issue with the BSEB and ensure power supply to the unit. Representatives of IRBI could not give a concrete view in absence of the detailed information pertaining to establishment of the units viability. IFCI, the lead institution was of the view that in terms of the extent rbi guidelines, the unit was not viable and the promoters expressed their inability then to bring the requisite funds to meet the shortfall in achieving a minimum DSCR of 1.33:1. The promoters were the invited for discussions and it was stated on their behalf that they were interested in early rehabilitation of the unit provided reliefs and concessions along with additional term loan, sales-tax exemption and purchase tax set off were sanctioned by the relevant authorities and two proposals were sub-mitted by the representatives of the promoters. One was for rehabilitation of the unit at an estimated cost of Rs.209 lacs envisaging additional term loans of Rs.72 lacs from other financial institutions but the IFCI and IDBI clearly expressed their unwillingness to increase their exposure in the unit. One was for rehabilitation of the unit at an estimated cost of Rs.209 lacs envisaging additional term loans of Rs.72 lacs from other financial institutions but the IFCI and IDBI clearly expressed their unwillingness to increase their exposure in the unit. The other proposal pertained One Time settlement (OTS)of dues from two parties. However, it was found that the institutions were not willing to waive a part of the principal outstanding as well as entire penal interest and other interest overdues. The promoters were therefore advised that in the proposal envisaging OTS the new incumbent/promotor would normally be required between 25% to 50% of the settled amount in a "no lien account" with a nationalised bank and in consultation with BIFR. However, it was noted that the promoters on an earlier occasion, could not arrange for funds to be deposited in "no lien account" when rehabilitation proposal was under consideration and the BIFR/afifr and the promoters therefore requested that they be given another opportunity for submitting a proposal under OTS. The revised rehabilitation scheme submitted by the petitioner has also been annexed with the counter-affidavit dated 3-1-1996 and on query made, the Learned counsel for the petitioner submitted that the reliefs/concessions granted by the State Government had been taken into account while preparing the rehabilitation scheme. 13. As mentioned above, the financial institutions and the Banks have refused to extend any further financial assistance to the petitioner and therefore the revised rehabilitation scheme furnished by the petitioner which envisages term loans from the banks/financial Institutions amounting to Rs.72 lacs would not be available to the petitioner and learned Counsel for the petitioner further stated that it is not possible for the petitioner to bring any other co-promotor and further that it would not be possible to make any proposal for One Time Settlement. 14. In view of the aforesaid discussions, it is evident that the efforts of bifr, the Appellate Authority and this court have failed for rehabilitation of the petitioner. 14. In view of the aforesaid discussions, it is evident that the efforts of bifr, the Appellate Authority and this court have failed for rehabilitation of the petitioner. The petitioner has no right to insist for its rehabilitation on its own terms and conditions and it has not been shown that the financial Institutions and the Banks are under any statutory obligation to extend financial assistance as claimed by the petitioner and no useful propose will be served in asking the Appellate Authority to reconsider its decision keeping in view the reliefs/concessions granted by the state Government as the revised rehabilitation scheme submitted by the petitioner is not acceptable to the financial Institutions/banks and the stand of the BSFC is that it would for the time being suspend the recovery of its loan but that would not in any event make the rehabilitation of the petitioner viable, therefore no relief can be granted to the petitioner in these proceedings. 15. In the result, the writ petition fails and it is accordingly dismissed. No order as to costs. Petition Dismissed.