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TMI Blog2013 (5) TMI 1069X X X X Extracts X X X X X X X X Extracts X X X X ..... led a suit for recovery of Rs. 44,05,803.47 of which the principal amount was Rs. 24,83,409.27; there was an interest figure of Rs. 15,39,714.20 and sales tax was claimed in the sum of Rs. 3,82,680/-. The suit was numbered as CS(OS) No. 2249/2008. The plaintiff claiming himself to the proprietor of M/s. Shree Shyam Packaging Industries, Gulshan Park, Opposite Rajdhani Dal Mills, Main Rohtak Road, Nangloi, Delhi was engaged in the business of manufacture and sale of packaging material. The appellant was a company engaged in the business of manufacture and sale of two wheeler scooter in the domestic as also in the foreign market. The appellant had sent a requirement to the respondent for packaging of its scooters which were meant for export; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he principal amount claimed in the suit is, however, a different figure; it is Rs. 24,83,409.27 which figure is noted supra has been disputed by the appellant; submission of the appellant on affidavit being that figure is not in conformity with the statement of account of the respondent itself. 5. The short question which had arisen before the learned single Judge was whether in view of the aforenoted factual scenario i.e. the appellant company having been declared as a sick company by the BIFR; could the suit filed by the respondent seeking recovery of money be proceeded with in the absence of permission from the BIFR. 6. Both the parties had addressed their legal submissions before the learned single Judge as is evident from the impugned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te of Rs. 3,00,000/- arose out of certain C-forms not having been issued by the appellant. 9. On 18.3.2013 it was reiterated by the appellant that the liability to the respondent of Rs. 21,74,490.88 was unequivocal; a further submission made was that if the C-Forms had not been supplied the liability towards the same would also be that of the appellant. The appellant was directed to file an affidavit in the aforesaid terms i.e. whether the C-Forms had been supplied and if no, what would be the effect on the liability qua the said C-Forms. Counsel for the appellant on that date also assured the court that if any modification is necessitated qua the amount required to be shown under the DRS an appropriate application would be filed before the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aim adjustment against the C-Forms as the amount already stand paid to the concerned authorities in 2006. The rest of the averments made in the affidavit are not disputed. 12. It is in this background that the question of applicability of Section 22 of the said Act arises. 13. The said Act had in fact been promulgated by the Legislature in 1985 to provide for a timely determination, by a body of experts, as a preventive and remedial measure for the revival and rehabilitation with respect to sick industrial units. The ill-effects of sickness in industrial companies, such as cessation of production, loss of employment, loss of revenue to the Central and State Governments and blocking up of investible funds of the banks and financial instituti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... overy of money or for the enforcement of any security against the industrial company or of any guarantee in respect of any loans, or advance granted to the industrial company shall lie or be proceeded with further, except with the consent of the Board or, as the case may be, the Appellate Authority. 15. The law with regard to Section 22 of the said Act is no longer re-integra The Apex Court in AIR 2012 SC 1440 Raheja Universal Ltd. Vs. NRC Limited and Ors. had the occasion to examine the aforenoted provision. The relevant extract reads herein as under: The said provision, thus, mandates that no proceeding inter alia for execution, distress or the like against any of the properties of the industrial company and no suit for recovery of money ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... element of debt since the question would be whether the debt due to the plaintiff is correctly reflected or a lesser amount is in fact due to him. The language of Section 22 would take into its sweep a situation even where if the full amount is not a part of the DRS. The question of continuation of the suit would not arise. 17. In such a situation it would be open to the respondent to approach the BIFR seeking leave for continuation of the suit qua the balance amount or in the alternate it may approach the BIFR seeking enhancement of the amount as included in the scheme if so permitted by law. 18. The judgment of Corromandal Pharmaceuticals (supra) is inapplicable in this factual scenario. That judgment related to sales tax dues of the dep ..... X X X X Extracts X X X X X X X X Extracts X X X X
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