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TMI Blog2010 (1) TMI 575X X X X Extracts X X X X X X X X Extracts X X X X ..... n 27-11-2009, these petitions are taken up for final disposal. 4. There are two writ petitions filed aggrieved by the same order of the AAIFR dated 18-9-2009 and of the BIFR dated 24-10-2008 - one by the company in respect of which proceedings are pending and the other petition by a strategic investor in the company. 5. M/s. Raam Tyres Limited (for short 'RTL'), one of the petitioners has been before the BIFR Board from 1997 onwards. The endeavours to revive the company were proving to be fruitless and thus it was agreed to change the management for which an advertisement was issued on 2-8-2006. M/s. Pelican Rubber Private Limited, respondent No. 2, the only contesting party in the present petition, submitted its proposal. There were two ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd to the arrangement and informed the BIFR that it would like to walk out of the deal and the funds should be refunded to it. It is not necessary to go into more details in this aspect but suffice to say that on 24-10-2008 an order came to be passed by the BIFR with a majority of two members and one member dissenting to the effect that the amount infused by respondent No. 2 should be refunded by 6 per cent interest. The second part of the direction was that a suitable advertisement should be issued for change of management in the leading newspapers as the earlier bid was to be treated as null and void. We may notice that the dissent was on this aspect. Respondent No. 2 did not challenge this order. 7. The order came to be only challenged ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... whether infusion of funds would ultimately result in conversion into equity and the managing director of RTL was called upon to take a categorical stand in this behalf. The managing director of RTL gave an undertaking that there was no change of management or conversion into equity but despite that the BIFR was not convinced of the undertaking. 8. It is interesting to note that the order of the AAIFR records the submissions of the opposite side which are really of respondent No. 2. Thus, respondent No. 2 pleaded that a strategic investor was not an entity having experience in the same business while respondent No. 2 had vast experience. Transparency required that a fresh advertisement should be issued so that even respondent No. 2 could p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cured Creditors of the company under OTS Scheme, to invest further monies for major repairs, purchase of the machinery and renovation of plant to invest into the working capital of the company for conducting production process. (c)Strategic Promotors/Co-promotors to bring in interest-free unsecured loans to meet the shortfall if any arises between the estimated requirement of the scheme and actual if any and to guarantee profitability projections and shortfall in funds flow due to any reason. (d)Strategic Promotors/Co-promotors to discharge any other liability whatsoever not foreseen in this scheme. (e)All statutory liabilities are to be met by the promoters/co-promoters as and when need arises. (f)To raise the necessary term loan for e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt was not interfered with. 15. In the present case the change of management is not envisaged and the strategic investor is only infusing funds. What is more important is that all stakeholders seem to be satisfied with the arrangement. 16. Learned counsel for respondent No. 2 strenuously contended that the issuance of a fresh advertisement was in the larger interest of transparency. We are unable to accept the plea for the reason that in a matter of this nature which is not dealing with the public contract what is really required to be considered is the interest of the stakeholders and if all the stakeholders are satisfied with the arrangement something must weigh very heavily to ignore it. 17. We are of the considered view that the BIFR ..... X X X X Extracts X X X X X X X X Extracts X X X X
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