S.K.Mookherjee, J. - (1.) This Revisional application is directed against order dated 10th of November, 1990 passed by the learned Judge, 3rd Bench, Small Causes Court, Calcutta, in Distress No. 50 of 1990. By the said order the learned Judge vacated the Distress issued against the present opposite party on 21.8.1990. The reason for such vacation appears to be the provision of section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985 (hereinafter referred to as the said Act).
(2.) Upon a consideration of the different provisions of the said Act, in the context of the submissions made by Mr. Kapoor in support of the Revisional application and Mr. Anindya Mitra on behalf of the contesting opposite party, it appears that sections 15, 16, 17 and 20 of the said Act purport to lay down a procedure for enquiring into the sickness of an Industrial Undertaking and also for taking of consequential steps. The Board constituted under the Act is empowered to entertain a reference under section 15 and to undertake an enquiry under section 16 of the said Act for the purpose of ascertaining whether the undertaking is a sick industrial company. In terms of section 17 of the said Act the Board has two options: (a) either to afford an opportunity to a sick industrial undertaking to make its networth positive and (b) to direct framing of a scheme. Section 18 enables the Board to take help of an expert agency, if necessary, to frame the scheme following the guideline indicated by the Board. The order of the Board, which is annexure 'A' to the present Revisional application, embodies its satisfaction that the opposite party is a sick industrial company. It also embodies its direction for taking of further proceedings under the Act with respect to the said company., Annexure 'B' to the Revisional application is a notice dated 12th September, 1990, which shows that the reference case, presumably in continuation and/or implementation of the direction in terms of the annexure 'A', fixed the date of hearing of the reference case in relation to the proceedings under the Act on 16th October, 1990. It appears that there is some controversy about the assertion made on behalf of the applicant before the trial court (opposite party herein) that a scheme has been sanctioned for reconstruction of the sick industrial undertaking. In the background of the aforesaid factual position, we have been invited to find out whether the criteria under section 22 of the said Act have been fulfilled and the impugned order is justified. Since the stage upto section 16 appears to have been admittedly completed, the Trial Court can be presumed to have exercised its power of vacating the Distress upon existence of criteria pertaining to immediately subsequent stage relating to the framing of a scheme under section 17 of the said Act. At this juncture, it is convenient to note the exact language of the relevant part of section 22 which is as follows: "any scheme referred to under section 17 is under preparation or consideration or a sanctioned scheme is under implementation."
(3.) The entire process envisaged by section 17, whether it ends with an opportunity to the company to make its networth positive or direction for framing of a scheme, falls within the stage of preparation or consideration of the scheme. Any other interpretation, assuming a distinction between the two contingencies as mentioned in section 17, would be absurd and would mean that the Board's conclusion must precede consideration for arriving at the same. In other words, it must be a foregone one. The learned Judge, in our view, was fully justified in vacating the order of distress with opportunity to the present petitioner to move the Board for proper redress as we find that the required criteria in terms of section 22 exist attracting the bar imposed by the said section.;