# In the matter of Hada Textile Industries Ltd. Vs. The Sales the Tax Officer Commercial Taxes & Ors. Civil Appeal No. 9995-2018

> SC judgment dated 2019-10-18. Citation: TCN-2019-SC-00018. The case involves a statutory appeal under Section 62 of the Insolvency and Bankruptcy Code (IBC)…

- **Court:** SC
- **Order date:** 18 Oct 2019
- **Citation:** TCN-2019-SC-00018
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/supreme-court-of-india/hada-textile-industries-ltd-vs-the-sales-the-tax-officer-commercial-taxes-ors-ci-8049fccf

## Summary

### Background

The case involves a statutory appeal under Section 62 of the Insolvency and Bankruptcy Code (IBC) 2016 against the final judgment and order dated 18.09.2018 passed by the National Company Law Appellate Tribunal (NCLAT), New Delhi. The appellant, M/S. HADA TEXTILE INDUSTRIES LTD., was declared a sick company by the BFIR on 10.08.2001 under the provisions of SICA, with IFCI appointed as the Operating Agency. A rehabilitation scheme was formed but expired in 2013 without the appellant's net worth turning positive. A modified plan was submitted but was under consideration when the Sick Industrial Companies (Special Provisions) Repeal Act, 2003 came into force. The appellant filed C.P.No.171/2017 before the NCLT, Kolkata, seeking an extension of the scheme, which was

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## Facts

M/S. HADA TEXTILE INDUSTRIES LTD. was declared a sick company by the BFIR on 2001-08-10 under SICA, and IFCI was appointed as the Operating Agency. A rehabilitation scheme was formed, but it expired in 2013 without the company's net worth becoming positive. The company submitted a modified plan, which was under consideration when the Repeal Act came into force. The company filed C.P.No.171/2017 before the NCLT, Kolkata, seeking an extension of the scheme, which was dismissed on 2017-04-13. Another application, C.P. No.406/KB/2017, was filed seeking an extension of the scheme's period, which was also dismissed on 2017-11-13 and confirmed in appeal by the NCLAT on 2018-09-18. The NCLT directed that liquidation proceedings should follow. The appellant claimed that its net

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## Issues and analysis

### Issue 1: Whether the appellant should be permitted to withdraw CP No.406/KB/2017, the original application …

**Ratio:** The court has the discretion to allow the withdrawal of an application if it deems it

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**Reasoning:** The court noted that the appellant was willing to withdraw the application and that the

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**Interpretation:** The court interpreted the situation as one where allowing the withdrawal would

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**Application:** The court applied the ratio by allowing the appellant to withdraw the

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## Parties

- **Judges:** UDAY UMESH…; ANIRUDDHA…
- **Respondents:** M/S. HADA TEXTILE…; THE SALES TAX…

## Timeline

- **2001-08-10 — Declaration as Sick…**: BFIR declared M/S. HADA TEXTILE…
- **2013-01-01 — Scheme E…**: Rehabilitation scheme expired without the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 62 — Appeal to Supreme Court](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-62)

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