SC Resolves Conflict Between SICA & Companies Act

Different situations can arise in the interplay between The Companies Act, 1956 and The Sick Industrial Companies (Special Provisions) Act, 1985 [for instance, in the matter of winding up of a company: i) where winding up proceedings are pending, but no order of winding up has been passed against the company, and a reference is made to the BIFR; ii) where a winding up order is passed by the Company Court but it is stayed in appeal and a reference is made to the BIFR]. Whatever be the situation, whenever a reference is made to the BIFR under Sections 15 and 16 of SICA, the provisions of SICA would come into play and they would prevail over the provisions of The Companies Act and proceedings under The Companies Act must give way to proceedings under SICA.”

Hon’ble Justice Madan B. Lokur, Madura Coats Ltd. v. Modi Rubber Ltd. [Civil Appeal No. 1475 of 2006].