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2015 (3) TMI 621 - DELHI HIGH COURTStay granted by DRT - Action taken under 13(4) of SARFAESI Act - Abatement of proceedings before BIFR - Held that:- In the opinion of this Court, mere direction to maintain status quo vis-a-vis a particular property would not mean that the legal effect of the notice has been effaced – at least that is the essential purport or intent of third proviso to Section 15(1) of SICA. The Court notices that the intention of the Parliament while enacting the third proviso to Section 15(1) of SICA was to avoid possible conflict between the provisions of SICA and SARFAESI given that both could potentially be construed as special enactments and that there was a degree of overlap, especially in the case of sick industrial debtors. To obviate this conflict, an express provision, making abatement conditional rather than universal was provided for. In the present case, this objective factor alone – apart from the measures to be taken under Section 13(4) was the subject matter of enquiry before the BIFR. As is evident from the extract of the BIFR’s order, all the secured creditors unanimously consented to the abatement of the proceedings. In these circumstances, the submission of the borrower that the petitioner did not represent the views of the 3/4th or more of such secured creditors has no force. In the absence of any special form or proceeding to record such consent, it has to be held that if such consent is expressed in the course of proceedings, especially before the BIFR or any other authority under the SICA, such consent is deemed valid. As far as the main contention – which apparently found favour with the AAIFR – with respect to the status quo order which operated in respect of Section 13(4) notice is concerned, this Court is of the opinion that the reasoning is meritless. The validity of Section 13(4) or for that matter any statutory matter cannot be judged on the basis of what an interim order states or purports to state. An interim order is only an aid or an arrangement which entitles the parties to the main proceedings, to work-out the modalities till final adjudication. Till the measures themselves are set-aside under Section 13(4), it cannot be said to be invalid or illegal. It goes without saying that a statutory order, till declared to be so in a legally constituted proceedings, would have to be accepted and given effect to.Refer case law is [1991 (8) TMI 328 - SUPREME COURT]. For the foregoing reasons, the impugned order is set aside. It is held that the proceedings before BIFR stood abated upon the service of the notice under Section 13(4). - Decided in favour of appellant.
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