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BIFR confirms wind-up of Perfect Drugs

Richa Mishra

NEW DELHI, Sept. 3

THE Board for Industrial and Financial Reconstruction (BIFR) has confirmed its prima facie opinion of winding up Perfect Drugs Ltd. (PDL).

At the recent hearing, the bench observed that there was no agreed proposal to be considered by the board. Further, the financial institutions (FIs) and banks were not prepared to consider the proposal submitted by the company.

They were also not prepared to accept the levels of sacrifice envisaged in the scheme. Therefore, there was no other alternative before the bench except confirming the wind-up, it said.

The BIFR bench concluded that the present promoters were neither serious nor resourceful enough to revive the company.

The bench recalled its order dated May 24 whereby it was observed that all possibilities to rehabilitate the company had been explored and exhausted and the bench had come to the prima facie opinion that the company was not likely to make its net worth e xceed its accumulated losses within a reasonable time while meeting all its financial obligations.

PDL, as a result, was not likely to become viable on a long-term basis and hence it was just, equitable and in public interest that it was wound-up under Section 20(1) of SICA.

Accordingly, a show-cause notice (SCN) for winding up the company was issued on May 29. The recent hearing was to hear objections and suggestions on this.

IFCI, the operating agency, submitted that the present Managing Director of the company, Mr. Arun Sahay, along with two other professionals submitted a sketchy proposal for revival of the company, vide their letter dated August 1.

The proposal envisaged huge sacrifices from the term lenders and the banks. Besides, the proposal was not as per RBI parameters. IFCI, further said that the company had not paid the valuation fee of Rs. 21,000 so far and expressed its inability to pay th is to the valuer. The company had refused to pay even the OA fees.

PDL had not got the balance-sheet audited for the last three years, the OA said. ``The present proposal is merely an attempt to buy time and is not worth consideration as none of the FIs and banks are prepared to accept this. Therefore, the winding-up of the company needed to be confirmed by the bench,''

it submitted.