Mandatory statutory bar under sick company law stops further winding-up proceedings and blocks alteration of interim orders.

Section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985 creates a mandatory bar on further winding-up proceedings once a reference is registered and an enquiry under section 16 is pending, unless the Board or appellate authority consents. In that setting, the company court cannot continue with the petition or take further steps that would advance it on the merits. The same statutory protection also prevents the court from modifying or suspending earlier interim orders passed in the winding-up matter, because ancillary judicial directions affecting the company are likewise caught by the embargo. The result stated is that the winding-up proceedings and related interim intervention were stayed.

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Issues: (i) Whether proceedings in a winding-up petition had to be stayed under section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985 after a reference was registered and enquiry under section 16 was initiated by the BIFR. (ii) Whether the company court could modify or suspend earlier interim orders passed in the winding-up petition while the matter was protected by section 22.

Issue (i): Whether proceedings in a winding-up petition had to be stayed under section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985 after a reference was registered and enquiry under section 16 was initiated by the BIFR.

Analysis: Section 22 creates a complete embargo against further proceedings in winding-up matters once an enquiry under section 16 is pending or a scheme is under preparation, consideration, or implementation, unless consent of the Board or the appellate authority is obtained. On the facts, the reference was entertained by the BIFR during the pendency of the winding-up petition and enquiry under section 16 had commenced, so the company court could not continue with the petition.

Conclusion: The winding-up proceedings were ed by section 22 and were rightly stayed.

Issue (ii): Whether the company court could modify or suspend earlier interim orders passed in the winding-up petition while the matter was protected by section 22.

Analysis: Once the statutory bar operated, the company court had no discretion to proceed further on the merits of the pending petition or to alter the earlier interim directions. The interim orders had been passed before the reference was registered, but section 22 prevented the court from taking any further step that would amount to proceeding with the matter.

Conclusion: The company court could not modify or suspend the earlier interim orders.

Final Conclusion: The appeals failed because the statutory protection under section 22 barred further judicial action in the winding-up proceedings and also foreclosed interference with the earlier interim orders.

Ratio Decidendi: Once a reference is registered and enquiry under section 16 of the Sick Industrial Companies (Special Provisions) Act, 1985 is pending, section 22 imposes a mandatory and comprehensive bar on further proceedings in the winding-up matter and on ancillary judicial orders affecting the industrial company's assets, save with the requisite consent.

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