1. This is an application filed by M/s. Akshaya Textiles Limited, ("the Company") under Regulation 44 of the Company Law Board Regulations, 1961 for stay of all further proceedings in C.P. No. 243 of 2008 initiated by S. Martin (SM), seeking directions against the Company to register the impugned transfer of shares, from the name of the transferor-second respondent (S.N. Santosh Kumar) to the transferee-petitioner (SM), pending final adjudication of O.S. No. 235 of 2008 on the file of the Court of Subordinate Judge, Coimbatore and until vacation of the restraint order passed by Board for Industrial and Financial Reconstruction (BIFR) against the transfer of shares, being the subject-matter of C.P. No. 243 of 2008, in support of which Shri R. Vidhya Shankar, learned counsel, appearing for the applicant submitted :

uSM allegedly entered into a Memorandum of Understanding on 14-11-2005 and an Agreement dated 19-11-2005 with S.A. Narahari Setty (NS) and V. Anjayaneyalu (VA), agreeing to transfer the shares of the Company to SM for a consideration of Rs. 15 crores, pursuant to which NS, VA and their associates reportedly delivered the share certificates in respect of their holding in the Company together with the share transfer forms in favour of SM. The latter lodged the relevant share transfer documents with the Company, whereas the board of directors of the Company declined to register the transfer of shares in the name of SM for the following, among other reasons:

(i)The Company is a Sick Industrial Company within the meaning of section 3(1)(o) of Sick Industrial (Special Provisions) Companies Act and reference made under section 15 of SICA is pending before BIFR in case No. 177 of 1989. BIFR by an order dated 16-2-2006 prohibited any alienation or disposal of shares in the Company, whereby the promoters/guarantors should not change their shareholding pattern or alienate or encumber or dispose their shares in the Company or there shall not be any changes in the Board of the Company without the specific permission of BIFR. SM lodged the shares with the Company on 26-3-2008, whereas the aforesaid restraint order of BIFR continues to be in force till date. BIFR by yet another order made on 7-8-2008 allowed one more opportunity to the Company to settle the disputes amicably with SM within a period of two months and further directed that the Company even by way of compromise should not bring about any change of management. The concept of promoters as commercially understood only means persons presently owning substantial stake in the company by way of shareholding and management. SEBI Regulations, 1997 defines the term promoter as the person or persons who are in control of the company, directly or indirectly, whether as a shareholder, director or otherwise. The order dated 23-5-2005 of AAIFR dismissing the appeal (Appeal No. 321 of 2001) recognised the fact that M/s. Sreekakulam Textiles Ltd., controlled by NS is the new prospective promoter of the Company. The BIFR order dated 27-8-2007 deals with, inter alia, the management and shareholding pattern of the Company. NS, VA and S.N. Santhosh Kumar are directors of the Company. NS being Chairman is in-charge of the overall operations of the Company. S.N. Santhosh Kumar is Managing Director taking care of production, quality control and admi-nistration of the Company. VA is looking after the finance and marketing of cotton. NS and VA are holding the entire 100 per cent shares of the Company. The promoters should (a) guarantee the projections of profitability, cash flow, etc.; (b) make good any shortfall in resources for meeting the capital expenditure or future cash flows; and (c) infuse interest-free funds of Rs. 298.34 lakhs. These directions are only against the present shareholders. The aforesaid BIFR orders are in force and, therefore, this Bench cannot proceed with the present Company Petition de hors the BIFR orders. By virtue of section 32(1) of SICA, the provisions of SICA