The SICA Act establishes mechanisms for identifying and addressing sickness in industrial companies. It places responsibility on company boards to report potential sickness issues to the BIFR. The Act also establishes the AAIFR appellate authority. Measures taken by experts under SICA aim to address industrial sickness through legal, financial and managerial restructuring in sectors where public money is invested. The BIFR was established under SICA to oversee rehabilitation of sick companies through schemes like financial reconstruction, management changes, amalgamation, sale or lease of assets.

1. SICA

3. Special Features of SICA
• The Act provides a legal identification of sickness in an industrial company.
• The Act places the responsibility of reporting sickness and potential
sickness of an industrial company the BIFR on the Board of Directors of
such a company.
• The Act also provides for be establishment of an Appellate Authority for
Industrial and Finance Reconstruction (AAIFR) for hearing appeals against
the orders of the BIFR.

4. Objectives of SICA
• Those measures are to be taken by a body of
experts.
• The measures are mainly — legal; financial re-
structuring and managerial.
• The SICA had been enacted in the public
interest to deal with the problems of industrial
sickness we regard to the crucial sectors where
public money is locked up.
•Those measures are to be taken by a body of
experts.
• The measures are mainly — legal; financial re-
structuring and managerial.
•The SICA had been enacted in the public interest to
deal with the problems of industrial sickness we
regard to the crucial sectors where public money is
locked up.

7. INTRODUCTION
 The BIFR was established under the Sick
Industrial Companies (Special Provisions) Act,
1985 (SICA). The asset-up in January 1987 and
became functional as of 15 May 1987. A new
industrial policy was tabled amen on 24 July
1991.
The companies (Amendment) Bill 2001
proposed to set-up a National Company Law
Tribunal (NCLT) and a national Company Law
Appellate Tribunal (.

8. Role of BIFR
• BIFR has a chairman and may have a maximum of
fourteen members, drawn from various fields
including banking, labour, accountancy,
economics, etc.
Securing the timely detection of sick and
potentially sick companies.
Speedy determination by- a group of experts of
the various measures to be taken in respect of
the sick company.

9. Schemes under BIFR
 Financial reconstruction of the company.
 Proper management of the sick industrial company either by
changing the management or takeover of management.
 Amalgamation of the sick industrial company with any other
company.
 Sale or lease of a part or whole of the sick industrial company.

10. Working of BIFR
Under the Central Government established a Board for
Industrial and Financial Re-construction (BIFR) to
exercise the jurisdiction and powers and discharge the
function and duties conferred or imposed on the Board
by the Act.
o The financial re-construction of the company.
o The proper management of the sick industrial company
by change in or takeover of management of the sick
industrial company.