What is the full form of BIFR
BIFR: Board of Industrial and Financial Reconstruction
BIFR stands for Board of Industrial and Financial Reconstruction. It was an agency of the Government of India and a part of the Department of Financial Services of the Ministry of Finance. It was established under the Sick Industrial Companies (Special Provisions) Act (SICA), 1985. Its aim was to revive and rehabilitate sick undertakings and closure or liquidation of the potentially sick or non-viable industrial companies. It provided suitable revival packages depending on the nature of the problem.
Industrial sickness began in India in the pre-independence days. In the beginning, the Indian government tried to counter it with some ad-hock measures including the Nationalization of Banks to provide temporary relief.
In 1975, RBI set up the Tondon committee. After one year, HN Ray Committee was formed in 1976. These committees suggested some measures which were not satisfactory.
In 1981, Tiwari Committee was constituted which suggested comprehensive legislation to deal with industrial sickness. Consequently, the SICA came into existence in 1985 and the BIFR was established in January 1987 under SICA.
In April 1987, an Appellate Authority for Industrial and Financial Reconstruction (AAIFR) was formed and the Government companies were brought under the purview of SICA in 1991. Later, it covered both public and private companies that have industrial undertakings.
In 2001, the Companies (Amendment) Bill was introduced as the government felt that the BIFR didn't meet its objectives of preventive industrial sickness.
In 2003, the Sick Industrial Companies (Special Provisions) Repeal Act was enacted which replaced the SICA and sought to replace BIFR and AAIFR with National Company Law Tribunal (NCLT) and National Company Law Appellate Tribunal (NCLAT).
On 1 December 2016 Government of India dissolved BIFR through official notification and all proceedings were to be referred to the NCLT as per the Insolvency and Bankruptcy Code.
Goals of the BIFR
A chairperson and two to fourteen other representatives make up the BIFR. All members must have at least 15 years of relevant professional experience in order to be eligible for election as High Court judges. Only large or medium-sized sick industrial firms, where significant amounts have been lost, are organised and managed by the Board.
Consequences of Industrial Sickness
According to the SICA (Sick Industrial Companies Act), BIFR has very broad authority. They are described as follows.