TMI Blog2004 (8) TMI 391X X X X Extracts X X X X X X X X Extracts X X X X ..... charges were being adjusted against the said advance. After clearing all the bills raised by the Company for claiming processing charges out of the amount paid in advance, the Company was liable to pay an amount of Rs. 2,48,858.94ps. After closure of the business transactions between the petitioner and the Company, an amount of Rs. 2,48,858.94ps. was payable by the Company to the petitioner at the end of the financial year 1988-89. The petitioner had been repeatedly requesting for the payment of the aforesaid amount but the Company did not make the payment. The petitioner was, therefore, entitled to recover the said amount from the Company along with interest at the rate of 18% and the said amount with interest calculated till 31-12-2001 has come to Rs. 20,58,416.22. 3. It is the case of the petitioner that in the balance sheet of the Company for the year 1988-89, the Company has shown a list of sundry creditors wherein at Ledger Folio 480 of Sundry Creditors, the name of the petitioner was shown and the amount outstanding which was payable by the Company to the petitioner was Rs. 2,48,858.94. Similarly, in the balance amount as on 31-3-1990, the petitioner s name was shown at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ending with BIFR and till the said scheme was under implementation, i.e., from the date when the said reference was registered by BIFR and till 31-3-1999, the claim of the petitioners against the Company for their respective amounts remained suspended and no proceeding for the payment of the said amount as also for winding up of the Company for its failure to pay the same could lie under the law. It was only after the said date of 31-3-1999, till when the said scheme was under implementation that the Creditors of the company were entitled to take such steps for payment of their dues or otherwise as are permissible. As per the provisions contained in sub-section (5) of section 22 of the Act, the period during which a creditor is prevented from taking any steps for the payment for his dues because of the above provisions, is excluded from the computation of the period of limitation. Since at the time of the order passed by BIFR and thereafter, the Company has managed its liability to pay the amount stated above to the petitioner and since the claim of the petitioners was suspended till 31-3-1999, the claim of the petitioners is not barred by the law of limitation. 7. Mr. Desai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he respondent would not deal with the sale proceeds received for the disposal of the properties, except for the purpose of maintenance of the properties and for payment of staff salary. 9. The matter was thereafter adjourned from time to time and in between terms of settlement were also going on. The interim relief granted by this Court has continued all throughout and since the terms of settlement failed, both the petitions are taken up for further hearing. 10. Mr. Ashok L. Shah, learned advocate appearing for the respondent Company in both the petitions has submitted that the petitioners are not entitled to the amount which they have claimed in the present petitions. The petitioners are not entitled to interest at the rate of 18% p.a. or at any other rate at all as claimed or otherwise.He has further submitted that since the Company was before BIFR and scheme of rehabilitation was sanctioned by BIFR, it has a binding effect on all persons covered by the scheme and from the date of coming into operation of the sanctioned scheme, it is binding on the Company, its shareholders, creditors and all others concerned. He has further submitted that any right, if at all, that the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mmittee that the scheme for rehabilitation of the respondent company was presented to the BIFR and which scheme was sanctioned by BIFR by its order dated 6-11-1990. Mr. Shah has, therefore, submitted that the proprietor of the petitioner firms thus very much a party to the said scheme which did not provide for payment of any interest and which provided for payment of dues of unsecured creditors for goods only from out of future profits of the company. Though the proprietor of the petitioner firms was well aware of all these facts, the petitioners have raised their claims, including claim for interest, with ulterior motives and only with a view to pressurise the company and to create prejudice against the respondent company. 13. Mr. Shah has further submitted that if there is any grievance against the implementation of the scheme, it is only BIFR which has a power and authority to review and monitor periodically the implementation of the sanctioned scheme. The petitioners should have, therefore, approached the BIFR under the provisions of the Act and BIFR alone is empowered and authorised to monitor the implementation of the sanctioned scheme. He has further submitted that this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 plain reading of the above section makes it clear that for its application, it must be shown that either an inquiry under section 16 was pending or scheme referred to under section 17 was under preparation or consideration or a sanctioned scheme was under implementation. During this period, no proceeding for winding up of the industrial company or for execution of distress or like against any of the properties of the industrial company or for the appointment of receiver in respect thereof would lie or be proceeded with further. Since the scheme was under implementation till 31-3-1999, there is no question of initiation of any proceedings against the Company till 31-3-1999. Sub-section (5) of section 22 says that "In computing the period of limitation for enforcement of any right, privilege, obligation or liability, the period during which it or the remedy for the enforcement thereof remains suspend ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tantial amount of interest and it is rather 7 to 8 times more than the principle amount which cannot be entertained or adjudicated upon in the winding up petitions as there are disputes with regard to interest whether it is chargeable and even if it is chargeable at what rate. It is also a debatable issue as to whether the petitioners are entitled to interest during the period of implementation of the scheme or whether scheme provides for payment of interest. Even with regard to the principal amount, the respondent company has denied its liability in the affidavit in reply and Mr. Shah has submitted during the course of his arguments that the proprietor of both the petitioner firms was a member of the Managing Committee formed by the Board of Directors to run the Company. There was every possibility that he must have received the amount which was due and payable to his respective proprietary firms. This also requires recording of evidence and this Court will not go into the factual aspects of the matter. The Court has formed the prima facie opinion with regard to the period of limitation as well as the operation and implementation of the scheme with special reference to future pr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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