State Financial Corporations Act, 1951
32C. Powers and duties of Directors and administrators
(1) Subject to the control of the Financial Corporation, the
Directors, or as the case may be, the administrators appointed under section
32A, shall take such steps as may be necessary for the purpose of efficiently
managing the business of the industrial concern and shall exercise such powers
and have such duties as may be prescribed.
(2) Without prejudice to the generality of the powers vested in them under sub-section (1), the Directors or as the case may be, the administrators appointed under section 32A, may, with the previous approval of the Financial Corporation, make an application to a court for the purpose of canceling or varying any contract or agreement entered into at any time before the issue of the notified order under section 32A, between the industrial concern and any other person and the court may, if satisfied after due inquiry that such contract or agreement had been entered into in bad faith and is detrimental to the interests of the industrial concern, make an order canceling or varying (either unconditionally or subject to such conditions as it may think fit to impose) that contract or agreement and the contract or agreement shall have effect accordingly.