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[2025:RJ-JP:51374]

HIGH COURT OF JUDICATURE FOR RAJASTHAN

BENCH AT JAIPUR

S.B. Civil Writ Petition No. 990/2018

Lords Chloro Alkali Ltd., S.P. 460, M.I.A., Alwar Raj. Through Its

AGM (Accounts & Finance)

----Petitioner

Versus

1. State Of Rajasthan, Through Secretary Industries

Department Government Of Rajasthan, Jaipur

2. Rajasthan State Industrial Development And Investment

Corporation Ltd. Through M.D.

----Respondents

For Petitioner(s) : Shri Anil Mehta, Senior Advocate with

Mr. Saurav Mehta,

Mr. Ranvijay Singh

For Respondent(s) : Mr. Basant Singh Chhaba, AAG with

Mr. Rahul Gupta,

Mr. Satyam Bhardwaj,

Mr. Rishabh Khandelwal, assisted by

Mr. Kartik Soti.

HON'BLE MR. JUSTICE PRAVEER BHATNAGAR

Judgment

Date of conclusion of arguments:- 02/12/2025

Date on which the judgment

was Reserved :- 02/12/2025

Whether the full judgment or only the operative part is

pronounced:- Full Judgment

Date of pronouncement:- 19/12/2025

1. The present writ petition under Article 226 of the

Constitution of India arises out of and relates to the provisions of

Sections 4(b) and 5 of the Sick Industrial Companies (Special

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Provisions) Repeal Act, 2003. The petitioner seeks quashing of the

demand notices dated 10.08.2017 and 15.09.2017 issued by

Respondent No. 2, and prays for directions to implement the

Rehabilitation Scheme sanctioned by the Board for Industrial and

Financial Reconstruction on 30.11.2006 in Case No. 308/2001.

2. The facts in brief are that the petitioner–Company was

incorporated on 01.03.1979 under the name Modi Alkali &

Chemicals Limited and, upon change of name on 01.10.2003, was

renamed as Lords Chloro Alkali Limited, operating a chemical

manufacturing unit at Alwar, Rajasthan.

3. Owing to continuous financial losses and erosion of its net

worth, a reference was registered before the Board for Industrial

and Financial Reconstruction (in short, ‘BIFR’) as Case No.

308/2001.

4. By order dated 15.01.2002, the petitioner was declared a

sick industrial company under Section 3(1)(o) of the Sick

Industrial Companies (Special Provisions) Act, 1985 (hereinafter

referred to as ‘SICA’) and thereafter, Industrial Development Bank

of India (IDBI) was appointed as the Operating Agency.

5. A Draft Rehabilitation Scheme (in short, ‘DRS’) was

thereafter circulated on 22.09.2006 to the State Government,

Rajasthan State Industrial Development & Investment Corporation

Limited (in short, ‘RIICO’), secured creditors, financial institutions

and statutory authorities.

6. After consideration of the responses received from

stakeholders, the BIFR sanctioned the Final Rehabilitation Scheme

on 30.11.2006 under Section 18(4) of SICA. The sanctioned

scheme, inter alia, recorded the restructuring of liabilities and a

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consolidated settlement of the outstanding Interest Free Sales Tax

Loan at 26.58% of the principal amount, payable in 7 annual

installments.

7. Following the sanction of the rehabilitation scheme,

correspondence was exchanged between the petitioner, RIICO and

the State authorities from 2007 to 2013 regarding certain aspects

of implementation. During this period, RIICO also issued various

communications concerning the petitioner’s dues. Subsequently,

on 06.07.2017, RIICO raised a demand relating to the IFSTL Loan,

pursuant to which an amount of ₹40,48,280 was deposited by the

petitioner on 27.07.2017.

8. Thereafter, RIICO issued further demand notices dated

10.08.2017 and 15.09.2017, seeking recovery of the entire

principal and interest due from IFSTL, leading to the filing of the

present writ petition.

9. Learned counsel for the petitioner submits that the impugned

demand notices have been issued in complete violation of the

Rehabilitation Scheme sanctioned on 30.11.2006. Under clause

10.8 of the Scheme, the unsecured IFSTL Loan of ₹152.76 lakhs

was finally