In a clear reprieve for Bachchan in his ongoing battle with the company's creditors, BIFR barred lead bankers Canara Bank, Allahabad Bank and others from proceeding further with their court cases.

ABCL had filed a reference with the board in March this year, seeking a sick status under the provisions of the Sick Industrial Companies (Special Provisions) Act, 1985, after making huge losses which led to complete erosion of its net worth of Rs 60.52 crore as on September 30, 1998. The company's accumulated losses stood at Rs 70.82 crore.

At the first hearing of one of the most high-profile cases at BIFR after Dunlop, a two-member bench comprising NP Bagchee and NP Singh appointed Industrial Development Bank of India (IDBI) as the operating agency. The board entrusted IDBI with the task of working out a fully-tied up revivalpackage for ABCL within six weeks.

The company has been instructed to fully cooperate with the operating agency in working out a viable scheme by August 20. The directors of ABCL have been directed not to draw remuneration till the revival package was in place.

At the hearing, the counsel for Canara Bank strongly objected to the sickness claim on the grounds that the company ought not to be declared sick since it had no manufacturing activity, the losses were artificially inflated, the object clause of the memorandum of association did not permit the company to manufacture audio cassettes, it had less than the requisite number of 50 employees on its payrolls and that its factory licence was obtained just before the reference was filed with BIFR. Under SICA clauses, a company seeking sick status must be engaged in some kind of manufacturing activity.

Allahabad Bank, which has an exposure of Rs 5.15 crore in ABCL, too, supported Canara Bank, with its representative pointing out that the company did nothave an undertaking that could be taken as scheduled industry.

However, the company's corporate advisor Ashok Deorah's argument that the company had a cassette manufacturing unit at Goregaon in Mumbai's western suburb was accepted by the board and after hearing the submissions made by SR Jariwala, chartered accountant representing ABCL, the bench declared the company sick.

ABCL chairman Bachchan was not present at the meeting. But barely a few minutes after his mega entertainment venture was declared sick, a relieved-looking Bachchan said efforts were being made to restructure the operations of the company. "It will be put back on track as per the revival scheme. Efforts would be made to bring it back to its old glory."

The company's chief executive officer, M Ajayan, who was present at the hearing, later said that ABCL will continue to be in the entertainment business, but will increase its presence in a big way. "Fortunately, interest burden is only about Rs 1 crore a year. We will only have to managethe company better," he added.

Speaking to the Press soon after the hearing, ABCL consultant MP Narang also promised that the company will submit a revival scheme ``acceptable to all'' to put an end to the unsavoury stalemate with the creditors. He did not, however, elaborate how the company planned to repay the creditors.

It may be recalled that Canara Bank had approached the Mumbai high court in March for recovery of Rs 10.5 crore it owed to ABCL. In the bitter legal battle, Canara Bank had sought permission to attach Bachchan's bungalow `Pratiksha' and two flats under the guarantor's clause.

The court restrained Bachchan from selling his Mumbai properties till the pending loan recovery cases of Canara Bank were disposed of. He had, however, pleaded that he had mortgaged his bungalow to Sahara India Finance for raising funds for his company. The bank then requested the board to allow the high court to appoint a court receiver for taking over the properties.

During 1992-93, 1993-94 and 1994-95, thenet profit of the company stood at Rs 3 crore, Rs 19 crore and Rs 14.4 crore respectively. However, the company incurred a massive loss of Rs 36.08 crore for the year ended September 30, 1997, which mounted to Rs 41.49 crore in 1997-98.