JUDGMENT

A. K. PATNAIK, J. : This is an application filed by the employees of M/s. Elconmet Ltd. (for short, “the Company”) in Company Act No.17 of 2001 to declare the sale of the assets of the said Company as null and void.

2. The facts briefly are that the Company made a reference to the B.I.F.R. under Section 15 (1) of the Sick Industrial Companies (Special Provisions) Act, 1985 (for short, ‘the SICA’). The reference was dismissed as non-maintainable by the B.I.F.R. on 30.4.1991. The Company preferred an appeal before the appel¬late authority for industrial and financial reconstruction and by order dated 12.12.1991, the said appellate authority remanded the case back to the B.I.F.R. After all attempts to rehabilitate the Company failed, the B.I.F.R. decided in its proceedings held on 19.2.2001 that it is just and equitable in the public interest to wind up the Company and appointed the IPICOL (Industrial Promo¬tion and Investment Corporation of Orissa Ltd.) as operating agency in terms of Section 20(4) of the SICA to arrange for disposal of the assets of the Company and directed that the entire sale proceeds after deducting expenses incurred in connec¬tion with the sale of the assets shall be deposited with the High Court for disposal by the Official Liquidator as per the provi¬sions of the Companies Act, 1956. Paragraphs-12, 13 and 14 of the said proceedings of the B.I.F.R. held on 19.2.2001 are quoted herein below :-

“12. After hearing the submissions of the OA, secured credi¬tors, banks, OSFC, OSEDC and others, the Bench noted that despite giving an opportunity to the company to rehabilitate itself no acceptable viable proposal had been submitted by the company which could be considered for its rehabilitation even at this late stage. The company had failed to take any steps to change its negative net worth and make it positive, although they had come to BIFR 10 years ago which fact gave an indication that the company and its promoters were taking undue advantage of law and were not serious about it’s rehabilitation. Moreover, the compa¬ny’s net worth still remained negative and their accumulated losses were mounting year after year. The Board, therefore, decided that it was just, equitable and in the public interest to wind up the company as the sick company viz. M/s. Elconmet Ltd. would not be able to make its net worth positive within a reasonable time while meeting all its financial obligations and concluded that its prima facie opinion for winding up of the company taken in the last hearing should be confirmed. The se¬cured creditors wanted to realize their outstanding amount through the sale of the assets of the company. However, the Bench appointed IPICOL as Operating Agency, (OA) in terms of Section 20(4) of the Act to arrange for disposing off the assets of the company.

13. IPICOL (OA) would constitute an Assets Sales Committee which should be chaired by a representative of IPICOL, not below the rank of GM, who would be the chairman of the Assets Sales Committee to decide about the sale of the assets of the company and he would decide about this through a representative each of SBI, OSFC, ICICI and a representative of the Company. The Assets Sales Committee would follow the guidelines for the disposal of the assets as per the guidelines given below :-

(a) All the assets should be got valued by an independent expert valuer and having regard to the likely market prices thereof, reserve price should be fixed in respect of each of the assets, if possible. Asset valuation should be got completed within a month from now and reserve price got approved by the Board.

(b) The sale of assets should be effected by way of public sale through sealed tenders, after adequate notice is given to the public through advertisements in three leading newspapers/trade journals - one of the news papers being in English and the other in the regional language of the locality where the assets are located. Minimum four weeks time will be a