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TMI Blog1997 (5) TMI 455X X X X Extracts X X X X X X X X Extracts X X X X ..... rate of Rs. 13680.00 per month. the tenancy of the petitioner company as terminated with the end of November, 1995. Mesne profits and damages at the rate of Rs. 90.00 per sq ft have been asked for from 1-12-1995 to 15-12-1995 amounting to Rs. 38475.00 Along with a relief for further damages/manse profits and interest on the said amount. (3) Section 22(1) of Sica provides as under : 22. Suspension of legal proceedings, contracts, etc:-(1) Where in respect of an industrial company an inquiry under Section 16 is pending of any scheme referred to under Section 17 is under preparation or consideration or a sanctioned scheme is under implementation or where an appeal under Section 25 relating to an industrial company is pending, then, notwithstanding any hing contained in the Companies Act, 1956 (1 of 1956), or any other law or the memorandum and articles of association of the industrial company or any other instrument having effect under the said Act or other law, no proceedings for the winding up of the industrial company or for execution, distress or the like against any of the properties of the industrial company or for the appointment of a receiver in respect thereof shall lie or be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erty of the sick industrial company. The submission is that the leasehold right of the appellant company in the premises leased out to it is property and since the eviction proceedings would result in the appellant company being deprived of the said property the said proceedings would be covered by category (2). We are unable to agree. The second category contemplates proceedings for execution, distress or the like against any other properties of the industrial company. The words or the like have to be construed with reference to the preceding words, namely, for execution, distress which means that the proceedings which are contemplated in this category are proceedings whereby recovery of dues is sought to be made by way of execution distress or similar process against the property of the company. Proceedings for eviction instituted by a landlord against a tenant who happens to be a sick industrial company, cannot in our opinion, be regarded as falling in the category. We may, in this context, point out that, as indicated in the Preamble, the Act has been enacted to make special provisions with a view to securing the timely detection of sick and potentially sick companies owning in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Shree Chamundi Mopeds Ltd (supra), the proceedings were not liable to be suspended under Section 22(1) of the Act. (8) Faced with the two decisions above said, the learned counsel, for the petitioner heavily relied on Maharashtra Tubes Ltd v. State Industrial and Investment Corpn. of Maharashtra Ltd and another, [1993]1SCR340 . The question arising for decision before their Lordships was whether the proceedings under Sections 29 and/or 31 of the State Financial Corporation Act, 1951 where liable to be stayed in view of the bar created by Section 22 of SICA. One of the contentions raised was that S. 22(1) uses the expression proceedings and not legal proceedings though the expression used in the marginal note is legal proceedings and hence S. 22(1) was not applicable to the impugned proceedings as they were mere proceedings and not legal proceedings. Their Lordships held that word 'proceedings' in S. 22(1) cannot be given narrow or limited meaning so as to confine it to 'legal proceedings' as such a narrow meaning would run contrary to law and would frustrate the purpose of S. 22(1) of Sica Interpreting the expression 'to the like', their Lordships held : Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer Vs. Corromandal Pharmaceuticals, 1997 Iii Ad Sc 713. The petitioner company was an assessed to sales tax assessed for the years 1992-93 and 1993-94 by orders dated 3.1.94 and in 1995 respectively. A scheme under Sica was sanctioned by the Bifr on 19.11.90. Recovery proceeding for the sales tax were assailed and stay was sought under Section 22 of the Act. The revenue contended that as the arrears of sales tax in question were related to the period after sanctioned scheme was brought under implementation, Section 22 of the Act was inapplicable and could apply only in respect of sales tax dues included in the sanctioned scheme. Their Lordships upheld the contention of the revenue and formed an opinion that Section 22(1) should be read down. Their Lordships held:- Instep for execution, distress or the like against the properties of the industrial company other of similar as steps should not be pursued which will cause delay or impediment in the implementation of the sanctioned scheme. In order to safeguard such state of affairs, an embargo, or bar is placed under Section 22 of the Act against any step for execution, distress or the like or other similar proceedings against th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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