TMI Blog2004 (2) TMI 365X X X X Extracts X X X X X X X X Extracts X X X X ..... tay the proceedings of the suit. Against the similar orders, the very same petitioner has filed the other three Revisions. 2. The first respondent herein B. Champalal Jain filed O.S. Nos. 2267/99, 2262/99, 2261/99, and 2265/99 on the file of the II Assistant Judge, City Civil Court, Madras for recovery of money based on promissory notes. In all the suits, the first defendant is M/s. Firenze Shoes P. Ltd., Chennai-117 second defendant is M/s. Lords Shoe Makers P. Ltd., Chennai-117, third defendant is SBP Madan Mohan, Chennai-41 and fourth defendant is Radhika Mohan and fifth defendant is I. Jairaj. Defendants 1 and 2 are companies and defendants 3 to 5 are Directors. Except 5th defendant, the petitioner in all the above revisions, others ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Chitra Narayanan, learned counsel for the petitioner, after taking me through section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985, would contend that in view of the pendency of proceedings before the BIFR, all the four suits cannot be proceeded with till the disposal of the proceedings before the BIFR. On the other hand, Mr. A. Venkatesan, learned counsel appearing for the contesting first respondent/plaintiff, contended that the petitioner neither a company nor a guarantor, the Court below is perfectly right in dismissing his petition. 5. The only point for consideration in these Revisions is, whether the suits are to be stayed till the completion of the proceedings before the BIFR ? 6. As said earlier, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the properties of the industrial company or for the appointment of a receiver in respect thereof and no suit for the recovery 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". The above provision makes it clear that section 22(1) attracts even a suit filed for recovery of money pending before any civil Court. Learned II Assistant Judge though accepted the fact that the company has approached the BIFR and proceedings, are pending after finding that the petitioner is neither a company nor a guarant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 22 imposes a prohibition on recovery from guarantors of the sick industrial company. The purpose behind such a provision is to prevent the isolated burdening of the guarantor or co-obligant with the debt of the sick industrial company, until recovery can be commenced against the sick industrial company itself, which fact has been disregarded by the learned trial Judge. Further, the materials placed clearly show that the loan was granted to the sick industrial company and that the petitioner was only the Director of the company. It is also clear that the petitioner has signed the debt instrument only as a Director on behalf of the sick industrial company and I hold that the benefit of section 22 of the Act will accrue to him. By virtue of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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