ICICI plea on Parasrampuria hearing rejected
Debashis Chaudhuri
NEW DELHI, January 18: The Board for Industrial and Financial Reconstruction (BIFR) has rejected ICICI's plea for postponing the first hearing of Parasrampuria Synthetics' case scheduled for Monday.The Delhi high court last week had dismissed ICICI's application for an injunction to bar Parasrampuria Synthetics (PSL) from approaching BIFR. In view of the on-going legal tussle between the two, PSL is likely to press the board for not considering ICICI as the operating agency from the creditors' side. The high court has also dismissed ICICI's plea for annulment of board resolution of September 1997. The PSL board had taken on record a net loss of Rs 318 crore which has been contested by ICICI. ICICI however alleged that the 1996-97 results of the company were misrepresented as the PSL promoters were taking recourse to gross financial mismanagement and siphoning out of funds from the company. ICICI was also apprehensive that the company will try to enter the BIFR net to duck a cumulative outstanding of overRs 500 crore to banks and financial institutions. However, in a judgment justice Vijender Jain of the Delhi high court last week said that in view of the correspondence (between the ICICI and PSL) on record, it cannot be said that the resolution which was passed by the company's board on September 20, 1997 was a surprise to the plaintiff (ICICI). The judgment further stated: "It seems as a financial institution the plaintiff was kept informed about the impending sickness of the defendant (PSL). It was too late in the day for the plaintiff to claim otherwise. As a matter of fact, instead of rushing to realise the loan amount, the plaintiff forgot that the creation of plaintiff was to generate industrial growth so as to make India industrially and economically a strong nation." ICICI had earlier recalled the loan worth over Rs 100 crore it had lent PSL. The judgment also said that it was all the more important to realise that the money of the plaintiff was more safe by having the defendant company
rehabilitated by restructuring. "Therefore, prima facie I am of the view that the resolution dated September 20, 1997 was not an act of fraud or creating stratagem to enable this court to exercise its jurisdiction and grant injunction," the judgment added.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
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