Bombay High Court: While hearing an application under Section 466 of the Companies Act, 1956 (Companies Act), a Single Judge Bench of Sharmila U. Deshmukh, J., declined to stay the winding up of Swadeshi Mills Company Ltd. (Swadeshi Mills). The Court reiterated that revival schemes must meet the triple test of bona fides, commercial morality, and public interest laid down in Meghal Homes (P) Ltd. v. Shree Niwas Girni K.K. Samiti, (2007) 7 SCC 753. Finding that the proposal was based on real estate development, inflated liabilities, and mortgaged assets, the Court held it lacked bona fides and rejected the application.
Background
The case arose from the winding up of Swadeshi Mills, ordered on 5 September 2005 after the Board for…