The central legal point established in the judgment is the applicability and interpretation of Section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985, which mandates the stay of legal proceedings against a sick industrial company and its guarantors until permission is obtained from the BIFR.

Common Order

Since the petitioner is one and the same and issue raised is also similar, they are being disposed of by the following common Order. C.R.P.No. 3388 of 2001 is directed against the order dated 24-9-2001 passed by the II Assistant Judge, City Civil Court, Madras in I.A.No.17651 of 2000 in O.S.No. 2267 of 99 in and by which, the learned judge dismissed the said petition filed to stay 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 were set ex parte. Pending the suit, 5th defendant/petitioner herein filed Interlocutory Applications in all the suits under Section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985, seeking to stay trial of the suit. In the affidavit filed in support of the above applications, it is stated that the first defendant company is a sick company and has been registered with the Board for Industrial Development and Financial Reconstruction (BIFR in short) as a sick industrial company. In view of the registration in terms of Section 22 of the Act, no suit or other proceedings can be initiated or continued against the company and the present proceeding is liable to be stayed. In other words, the petitioner has prayed for an order staying the suits till the completion of the proceedings before B.I.F.R. The said applications were resisted by the plaintiff by filing counter affidavit. Before the II Assistant Judge, three documents were marked as Exs. P-1 to P-3 on the side of the petitioners. No oral evidence was let in by both sides. The learned II Additional Judge on appreciation of rival contentions, after holding that the petitioner neither the company nor the guarantor filed suit promissory note and he is only an individual, refused to grant stay of the suit and ultimately dismissed all the four applications; hence the present Revisions.

3. Heard Ms. Chitra Narayanan, learned counsel for the petitioner, and Mr. A. Venkatesan for first respondent.

4. Ms. 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 first respondent herein/plaintiff filed four suits against the company and it its Directors claiming money based on promotes. In the suit promissory notes the petitioner herein namely I. Jairaj has put his signature in 4 places, two as Managing Director and in two places without mentioning anything. The name of the two companies, namely, defendants 1 and 2 are also mentioned in the promissory notes. No doubt, except 5th defendant, petitioner in these revisions all others are not contesting the suit. It is the claim of the petitioner that the company has filed an appropriate petition before the BIFR and the Board has a