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4. There is some dispute between the parties with regard to the manner and time in which these payments were or were not made. On failure to attain the object of restructuring, the Respondent-Company submitted a proposal to the consortium of banks for Corporate Debt Restructuring (CDR) and improving the performance and to achieve positive results during the year 2006-07. The CDR mechanism used the land sale proceeds. Upon making the proposal, the Respondent-Company discontinued its production activity in the nylon plant. The CDR Empowered Group approved the package for restructuring of debts on 21st January, 2008 but still it could not improve the financial business position of the Respondent-Company till the period ending on 30th June, 2008. On or about 24th September, 2008, the consortium banks released their interest over the property. An agreement with the recognized employees’ unions was also entered into on 5th September, 2008 but then it ran into problems, as it was contended by the Labour Unions that their dues should be cleared first and on transfer of land, Appellant-Company should provide 18 acres of land for a proposed employee’s colony. An early retirement scheme was also introduced and out of the total strength of 3725 employees, about 577 employees opted to take the benefit of this scheme. The Respondent-Company then negotiated with the Appellant-Company sometime in September 2008 for payment of the third instalment of Rs.48.90 crore. However, simultaneously, the Labour Unions raised the question of payment of bonus which adversely affected the revival plans. The chemical plant of the company was re-started. On 3rd December, 2008, the Respondent-Company moved an application before the BIFR in Case No. 55 of 2008 under Section 15(1) of the Act of 1985. The Appellant-Company refused to release the third instalment and resultantly, even the dues of 577 employees, who had taken the benefit of the early retirement scheme, could not be cleared. The BIFR, vide its order dated 16th July, 2009, fixed the cut-off date as 30th July, 2007. It directed that the sale of assets, including investments, will require prior approval of the BIFR. It also appointed the Punjab National Bank as the Operating Agency under Section 17(3) of the Act of 1985.

“(i) The Company shall submit a fully tied up DRS to the OA (Punjab National Bank) (PNB) within a period of three months. The sale of 350 acres of land stated to be approved by the CDR Empowered Group (EG) and the secured creditors may form part of the DRS. The details of the land to be sold including survey numbers should be clearly specified. The company shall give similar details of the remaining land and conform that it is adequate for the functioning and viability of the company on long term basis. The OA (PNB) shall convene a joint meeting of all concerned and submit a fully tied up DRs, if it emerges, along with the minutes of the joint meeting within a further period of one month.

42. The scheme of rehabilitation in relation to the sick industrial company was presented before the Corporate Debt Restructuring (CDR) Empowered Group which was appointed by the consortium of the banks to whom large sums were due from the said company on 13th June, 2007. The scheme was approved by the CDR on 12th December, 2007 which resulted in issuance of a letter of approval dated 21st January, 2008. Prior to the complete implementation of the revival scheme, the Respondent Company applied to the BIFR under Section 15 of the Act of 1985 for being declared as a ‘sick company’ on 3rd December, 2008. During the consideration of this application, the rehabilitation scheme approved by the CDR was placed before the BIFR for its acceptance and adoption. Vide its order dated 16th July, 2009, passed under Section 17(3) of the Act of 1985, the Scheme was adopted and for the purposes of implementation of the Scheme, the cut-off date was declared as 30th July, 2007 by the BIFR. As already noticed, the parties had entered into a Memorandum of Understanding dated 13th April, 2006 and the Agreement to Sell dated 1st March, 2007 for sale of the land belonging to the company. The BIFR, while approving the scheme, had taken into consideration these events in relation to the sale of the land. Thereafter, the parties executed Supplementary Agreements dated 29th September, 2007 and 17th August, 2010. The Agreements provided for pre- ponement of the instalments payable in terms of the Agreements as well as giving of possession of the land to the Appellant Company. The Agreement dated 29th September, 2007 was executed when the rehabilitation scheme was pending consideration before the BIFR, while the Agreement dated 17th August, 2010 was executed subsequent to the adoption of the Scheme by the BIFR. It appears from the record that the Second Supplementary Agreement dated 17th August, 2010 was not executed between the parties with prior approval of the BIFR. The BIFR, vide its order dated 16th July, 2009, had placed certain restrictions and had not permitted the transfer of the land without its prior approval. It had also raised certain other queries including valuation, etc. This order was set aside by the AAIFR, which had permitted the sale of the land in favour of the Appellant Company, even during the consideration and implementation of the revival scheme. This order of the AAIFR dated 28th May, 2010 was disturbed by the High Court vide its order dated 29th July, 2011. The High Court practically restored the order of BIFR, giving rise to the present appeal.