Druckgrafen declared sick unit

CHANDIGARH, Jan 7: The controversy regarding the Druckgrafen India Ltd., which was being sought to be wound up by creditors, who had file...

CHANDIGARH, Jan 7: The controversy regarding the Druckgrafen India Ltd., which was being sought to be wound up by creditors, who had filed criminal complaints against the Managing Director and other directors, has for the time being, been set to rest, with the company being declared a sick unit by the Board for Industrial and Financial Reconstruction BIFR. Earlier, petitions filed in Punjab and Haryana High Court for winding up of the company by creditors had been disposed of, awaiting the decision of the BIFR, whereafter the petitions could be revived if so advised.

The BIFR while declaring the company, a sick unit, concluded that the company cannot revive on its own and so it was necessary to take steps for its revival in public interest. In pursuance of these observations, the BIFR has appointed the Industrial Finance Corporation of India as the operating agency to examine the viability of the company and to formulate a rehabilitation scheme.

The IFCI has been directed to take into consideration the guidelines issued by BIFR which also include taking care of the interests of the creditors. The guidelines require the IFCI to get the assets of the company evaluated, study the detailed techno-economic viability, suggest cost reduction measures, relief concessions within the RBI regulations, requirement of interest free funds, market potential and sacrifices/reliefs from creditors and labour, if any. June 30 has been fixed as the cut-off date.

The company/promoters have also been directed to submit a rehabilitation scheme to the IFCI along with the accounts of the previous five years and whatever else is required by the IFCI within eight weeks. The company/promoters have also been restrained from disposing of any current or fixed assets of the company without the consent of the BIFR.

The declaration has come on the basis of the report of the IFCI, which had earlier, vide order dated July 17, 1998, been directed to inquire into and make a report regarding the accounting system of the company regarding bad debts, depreciation etc. which had been objected to by PNB, who too was associated in the inquiry, under orders of the BIFR.