Sick industrial companies special provisionsact1985. A new industrial policy was tabled in parliament on 24 july 1991 aiming to maintain growth in productivity and gainful employment and to encourage the growth of entrepreneurship and upgrades to technology. Government finally repeals sica years after repeal act was. Read to know more about the industrial sickness in this article for the upcoming upsc 2020 exam. Short title, extent, commencement and application 1 this act may be called the sick industrial companies special provisions act, 1985. The board for industrial and financial reconstruction bifr was formed under the sica to determine the sickness of such industrial companies and. Sick industrial companies special provisions act, 1985 repealed and bifr aifr dissolved december 1, 2016 in brief the ministry of finance mof, vide notification nos. The provisions of sick industrial companies special provisions act, 1985 after having assented by the president of india on 8th january, 1986, the same was provided to objective to check sickness and expedite the process of revival of efficient and viable sick industrial companies and closure of those unviable. The sick industrial companies special provisions repeal act.
Effective date of sick industrial companies special provisions repeal act, 2003 is not yet notified in the official gazette. The sick industrial companies act sica was a key piece of. Reference by the companies may be filled in form a us 151 of the sick industrial companies special provision act. Repeal of sick industrial companies special provisions act, 1985. Rehabilitation under sick industrial companies special. Apr 25, 2012 the companies act 1956 deals with sick companies provisions under section 424a to 424 l. We may note this chapter has much wider impact then earlier act of 1985. Repeal of sick industrial companies special provisions act. Special provision for payment of tax by certain companies. The sick industrial companies special provisions act, 1985. Effective date of sick industrial companies special provisions repeal act, 2003 is. Introduction sick industrial companies special provisions act, 1985, as indicated by its title and preamble, was a special legislation enacted in public interest with the twin objects of securing the timely detection of sick and potentially sick companies speedy determination and enforcement of remedial measures i. The sick industrial companies special provisions act, 1985 being act no.
When the sick industrial companies special provisions repeal act was passed in 2003, the idea was to do away with the bifr and let the companies act subsume powers of restructuring. Rehabilitation under sick industrial companies special provisions act, 1985 3. Chapter xix of the 20 act lays down the provisions for the revival and rehabilitation of sick companies. Sick industrial companies special provisions repeal act, 2003. Revival and rehabilitation of sick companies under new act. In exercise of powers conferred by subsection 2 of section 1 of the sick industrial companies special provisions repeal act, 2003 1 of 2004, the central government hereby appoints the 1st day of december, 2016, as the date on which the provisions of the said act shall come into force. Home actsofparliamentfromtheyear the sick industrial companies special provisions act, 1985. An act to make in public interest, special provisions with a view to securing the timely detection of sick and potentially sick companies owning industrial undertakings, the speedy determination by a board of experts of the preventive, ameliorative, remedial and other measures which need to be taken with respect to such companies and the.
Revival and rehabilitation of sick companies under new act 20. Repeal of sick industrial companies special provisions. Nov 30, 2016 when the sick industrial companies special provisions repeal act was passed in 2003, the idea was to do away with the bifr and let the companies act subsume powers of restructuring. The sick industrial companies special provisions repeal act, 2003 was enacted to repeal the sick industrial companies special provisions act, 1985. According to it the government has removed sick industrial companies from the purview of the monopolies and restrictive trade practices act, 1969, for purposes of modernisation, expansion, amalgamation or merger. As per section 246aa of companies act 1956 sick industrial company means an industrial company, which has at the end of any financial year. Although it aims to provide comprehensive provisions for the revival and rehabilitation.
The most important piece of legislation dealing with industrial sickness was the sick industrial companies special provisions act, 1985 sica. Be it enacted by parliament in the fiftyfourth year of the republic of india as follows. The board for industrial and financial reconstruction bifr was formed under the sica to determine the sickness of such industrial companies and to prescribe measures either for the revival. In accordance with the policy decision of the government of india, the sick industrial companies special provisions act, 1985 was passed by the parliament which received the assent of the president of india on january 8, 1986. The sick industrial companies act sica was a key piece of legislation dealing with the issue of rampant industrial sickness in india. Industrial sickness can be defined as a steady imbalance in the debtequity ratio that results in the distortion of the financial position of a unit. Any declaration made under subsection 3 with respect to a sick industrial company shall have effect notwithstanding anything contained in the companies act, 1956 1 of 1956, or any other law, the memorandum and articles of association of the company or any instrument having effect under the said act or other law or any agreement or any decree or order of a court, tribunal, officer or other. Sick industrial companies special provisions act, 1985. The sick industrial companies special provisions act, 1985 sica was enacted to make special provisions for the timely detection of sick and potentially sick companies owning industrial undertakings. The board for industrial and financial reconstruction bifr was formed under the sica to determine the sickness of such industrial companies and to prescribe measures. An act to repeal the sick industrial companies special provisions act, 1985.
Apr 09, 2015 the provisions of sick industrial companies special provisions act, 1985 after having assented by the president of india on 8th january, 1986, the same was provided to objective to check sickness and expedite the process of revival of efficient and viable sick industrial companies and closure of those unviable. Institutes act rdbfi 1985 sick industrial companies special provisions act bifr 2001 corporate debt restructuring cell cdr 2002 sarfaesi act arcs 2014 announced asset classification forbearance on restructuring ended from march 2015 jan 2014 revitalising distressed assets in the economy sma and jlf dec 2014 flexible structuring of. Provisions of sick industrial companies the dollar business. Sick industrial companies special provisions act, 1985 repealed and bifr aifr dissolved pdf. Sick companies the companies bill 2011 caclubindia. To repeal the sick insdustrial companies special provisions act, 1985. Board for industrial and financial reconstruction wikipedia. Industrial sickness definition, special provisions act. Section 22 in the sick industrial companies special. Banking acts department of financial services ministry of finance. In 1985, the sick industrial companies special provisions act sica was passed.
The most important piece of legislation dealing with industrial sickness was the sick industrial companies special provisions act,1985 sica. The industrial finance corporation transfer of undertakings and repeal act1993. Sick industrial companies special provisions repeal act. An act to make, in the public interest, special provisions with a view to securing the timely detection of sick and potentially sick companies owning industrial undertakings, the speedy determination by a board of experts of the preventive, ameliorative, remedial and other measures which need to be taken with respect to such companies and the. Sick industries, sick industrial companies special. The government defined the industrial sickness for the first time in the sick industrial companies special provisions act, 1985.
Jan 28, 2018 and, whereas, the unamended second proviso to clause b of section 4 of the sick industrial companies special provisions repeal act, 2003 provides that any scheme sanctioned under subsection 4 or any scheme under implementation under subsection 12 of section 18 of the repealed enactment i. For the removal of doubts, it is hereby declared that an industrial company existing immediately before the commencement of the sick industrial companies special provisions amendment act, 1993, registered for not less than five years and having at the end of any financial year accumulated losses equal to or exceeding its entire. Section 4b of sick industrial companies special provisions. Petitioner has further stated that the sick industrial companies special. The sick industrial companies special provisions act, 1985 sica was enacted to make special provisions for the timely detection of sick and potentially. Industrial sickness is defined all over the world dubious discuss as an industrial company being a company registered for not less than five years which has, at the end of any financial year, accumulated losses equal to, or exceeding, its entire net worth and has also suffered cash losses in such financial year and the financial year immediately preceding such financial year. Assistance from pro, bifr can be taken in filing the references. It applies to industrial undertakings both in the public and private sectors. Nov 30, 2016 the sick industrial companies special provisions repeal act, 2003 sicspra shall come in force from december 01, 2016 vide notification issued in official gazette on november 25, 2016. And, whereas, the unamended second proviso to clause b of section 4 of the sick industrial companies special provisions repeal act, 2003 provides that any scheme sanctioned under subsection 4 or any scheme under implementation under subsection 12 of section 18 of the repealed enactment i. The practical lawyer overriding effect of the sick industrial.
Under the sick industrial companies special provisions act, 1985, the bifr has powers to declare a company having one or more industrial undertakings as a sick industrial company and consider and sanction a scheme for revival and rehabilitation of the sick industrial company. The chapter describes the circumstances which determine the declaration of a company as a sick company, and also includes the rehabilitation process of the same. The sick industrial companies special provisions repeal act, 2003 sicspra shall come in force from december 01, 2016 vide notification issued in official gazette on november 25, 2016. The sick industrial companies special provisions act, 1985 sica was. Where on a demand by the secured creditors of a company representing fifty percent or more. Sick industrial companies special provisions act, 1985 and bifr. The companies act 1956 deals with sick companies provisions under section 424a to 424 l. The board was set up in january 1987 and became functional as of 15 may 1987. The sica received presidential assent on 8 january, 1986 and had been in operation since then. An act to make, in the public interest, special provision with a view to securing the timely detection of sick and potentially sick companies owning industrial undertakings, the speedy determination by a board of experts of the preventive, ameliorative, remedial and other measures which need to be taken with respect to such companies and the expeditious enforcement of the measures so.
This chapter may and will replace the provisions of sick industrial companies special provisions act, 1985. The bifr was established under the sick industrial companies special provisions act, 1985 sica. An act to make, in the public interest, special provision with a view to securing the timely detection of sick and potentially sick companies owning industrial undertakings, the speedy determination by a board of experts of the preventive, ameliorative, remedial and other measures which need to be taken with respect to such companies and the. Provisions repeal act, 2003, hereinafter referred to as sica repeal act, 2003. For the removal of doubts, it is hereby declared that an industrial company existing immediately before the commencement of the sick industrial companies special provisions amendment act, 1993, registered for not less than five years and having at the end of any financial year accumulated losses equal to or exceeding its. The sick industrial companies special provisions act, 1985 no. But ever since, there have been several rounds of changes and counter changes, which finally led to the enactment of the companies act of 20. It aimed to repeal the presidency towns insolvency act, 1909 and sick industrial companies special provisions repeal act, 2003, among others. Apr 09, 2015 the sick industrial companies special provisions act, 1985 being act no. Sick industrial companies act sica definition investopedia. Sica also has provisions which override all other laws except the few legislations mentioned in the act itself. The special court trial of offences relating to transactions in securities act1992.
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