(1) According to section 40 of the Act, the classification of sick industries will be done on the basis of the following criteria:-
(a) Totally sick industries:-
(1) The company's capital (equity) has decreased by more than seventy percent and has been running continuously for the last three years,
(2) For the last three years- continuously operating at less than twenty percent of connected capacity,
(3) Complete closure of the industry for the last three years due to any other reason. Being, and
(4) According to the Act and this regulation, when the Government of Nepal gives any discount, facility or concession, it is seen that it can be operated profitably within a maximum of five years.
(b) Sick Industries:-
(1) The capital (equity) of the industry has decreased by more than fifty percent and has been running continuously for the last three years,
(2) has been operating at less than twenty-five per cent of the connected capacity continuously for the last three years, (3) the industry has been completely closed for the last two years for any reason other than willful or due to managerial deficiency, and
(4) According to the Act and this regulation, when the Government of Nepal gives any discount, facility or concession, it is seen that it can be operated profitably within three years at the most.
(c) Sick Oriented Industries:-
(1) The capital (equity) of the industry has decreased by more than thirty percent, operating at a loss for the last three years,
(2) has been continuously operating at less than thirty percent of connected capacity for the last three years,
(3) The industry has been completely closed for the last one year for any other reason, and
(4) According to the Act and this regulation, when the Government of Nepal gives any discount, facility or concession, it is seen that it can be operated profitably within two years at the most.
(2) According to sub-rule (1), while classifying the sick use, the professional plan or action plan of the use, the audit report of the production and the use done by the industry in the past, and the on-site inspection report of the technician or expert shall be taken as a basis.