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Issues Involved:
1. Applicability of the Bombay Relief Undertakings (Special Provisions) Act (BRU Act) and the notification issued thereunder. 2. Whether depositing a cheque is an exercise of a right or an enforcement of a remedy. 3. Allegation of mala fide intention behind filing the suit to protect directors from criminal proceedings under sections 138 and 142 of the Negotiable Instruments Act. 4. Justification of the Trial Court in granting interim injunction based on prima facie case, balance of convenience, and irreparable loss or injury. Detailed Analysis: Issue 1: Applicability of the BRU Act and Notification The main object of the BRU Act is to provide temporary relief to industrial undertakings to prevent unemployment. Section 4(1)(a)(iv) of the Act states that any right, privilege, obligation, or liability accrued before the undertaking was declared a relief undertaking, and any remedy for enforcement thereof shall be suspended. The Court noted that the provision only suspends the remedy for enforcement of rights, not the rights themselves. The act of presenting postdated cheques is an incident of the right and is not suspended by the notification. Issue 2: Nature of Depositing a Cheque The act of presenting a cheque for payment is akin to making a demand for repayment and does not amount to enforcing repayment. Enforcement of remedy implies actions like instituting a suit or attaching property, which is not the case with presenting a cheque. The Court held that presenting a cheque is an incident of the right and not an act of enforcement of remedy, thus not suspended by the BRU notification. Issue 3: Allegation of Mala Fide Intention The appellant argued that the suit was filed with the intention of protecting the directors from criminal proceedings under sections 138 and 142 of the Negotiable Instruments Act. The Court observed that the company is not restrained from making payments to its creditors and that the BRU notification does not protect directors from criminal liability. It inferred that the suit was filed with an oblique motive to shield the directors from criminal prosecution. Issue 4: Justification of Interim Injunction The Court examined the principles of prima facie case, balance of convenience, and irreparable loss or injury. It found no prima facie case in favor of the company, as the liability to pay was undisputed, and the presentation of postdated cheques would not harm the company. The balance of convenience was not in favor of the company, and preventing the appellant from exercising its legal right caused irreparable injury to the appellant. Thus, the Trial Court's decision to grant an injunction was unjustified. Conclusion: The impugned order dated 22-4-2003 passed by the Trial Court was quashed and set aside. The appeal was allowed, and the rule was made absolute in Civil Application No. 2961 of 2003. The stay granted by the Trial Court was extended till 30-4-2004 to allow the respondent company to challenge the judgment in a higher forum.
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