TMI Blog1986 (5) TMI 273X X X X Extracts X X X X X X X X Extracts X X X X ..... itudes. The last twenty years particularly, witnessed its pendulum widely swinging between profit and loss - less profits and more losses. And in these very recent years, matters turned from bad to worse. Efforts to salvage the situation did not cut much ice. Negotiations vis-a-vis government, financial institutions and others also suffered the same fate. All the combined experience and expertise failed to resolve the deepening crisis. According to the management, the Company reached a point of no return. The loss in 1984 was almost 500 lacs and in the succeeding year (]985) 476 lacs. From January 1986 onwards, the Company, as per the management, was making additional loss of about 100 lacs per month. The liability against secured loans was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... initiate a process in that regard. When this process would commence is not disclosed and is thus anybody's guess. The certain conditions on which this process of take-over would be based are also not disclosed. Bonafide though it be, the decision does not measure up to the urgent need for prompt action. The Government would, however, be free to go ahead - and it should go ahead - with its well-intentioned decision aforesaid. And this Court for one has no doubt that the Government will receive due co-operation from all parties in translating the same into reality. 4. This summons, however, can no longer be kept adjourning and pending, It is not possible to continue to keep waiting and watching. Speed is now of the essence. Delay wou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cal benefits of such appointment and the possible consequences otherwise. In this judicial process, the Court will not overlook the dire need of the moment and the attendant' risk in default of such appointment. So considering this judge's summons together with the specter of commercial insolvency looming large over the Company and the imminent risk and danger to its assets and the escalating gravity of the financial crisis, a provisional liquidator becomes an urgent need and a must. Reluctance and/or delay may be politically expedient but judicially neither expedient nor prudent. Indeed, none appearing in these proceedings could suggest any effective and convincing alternative to a provisional liquidator. 6. The appointment is a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e pending winding up proceedings. Therefore, everything is to be gained and nothing to be lost by this appointment. 8. Of course, a provisional liquidator has no Alladjn's lamp in his hands nor any magic formula up his sleeve. Nor is his appointment a panacea for all the ills afflicting a company. But in a case as the instant, the benefits of such appointment would far out-weigh all other considerations. Apart from the consequences flowing ipso facto therefrom, it will also open up a new vista, throw up different possibilities and provide diverse means for an amicable way out. There will also be - and this is vital - a rekindling of real hope in the hearts of the workers. The provisional liquidator can examine and explore various pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and determination can considerably help bring in positive results. On his part, Mr. Palkhivala, learned Counsel for the Company, assured the Court - and this is a very significant statement - that the Company will not challenge any take-over of the management nor will it challenge any take-over even of the assets and properties of the Company nor claim any compensation in that behalf and, what is more, the House of Tatas, who are secured creditors, would also give up their entire security. These assurances not only remove all possible misgivings qua the management but also reflect their sincerity to the cere. The sacrifice implicit therein is, indeed, of a high order. As said, self-sacrifice is the truest test of sincerity. Hoping then for ..... X X X X Extracts X X X X X X X X Extracts X X X X
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