SICA restraint order does not automatically bar section 138 NI Act proceedings; threshold objection was premature.

Section 22A of the Sick Industrial Companies (Special Provisions) Act, 1985, which restrains disposal of assets of a sick industrial company without Board consent, does not by itself create a complete bar to institution or continuation of proceedings under section 138 of the Negotiable Instruments Act, 1881. The effect of any BIFR restraint order on the company's assets or conduct is a matter for examination at the appropriate stage before the trial court, not for rejection at the threshold in revisional jurisdiction. On that basis, the objection that the prosecution was barred by SICA was treated as premature and rejected.

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Issues: Whether prosecution under section 138 of the Negotiable Instruments Act, 1881 was barred or could not be instituted against a sick industrial company during the subsistence of a restraint order under the Sick Industrial Companies (Special Provisions) Act, 1985, and whether the objection was premature.

Analysis: Section 22A of the Sick Industrial Companies (Special Provisions) Act, 1985 empowers the Board to direct that a sick industrial company shall not dispose of its assets except with consent of the Board. On the basis of the statutory scheme and the decisions referred to, the Court held that this restraint does not create a complete bar to the institution or continuation of proceedings under section 138 of the Negotiable Instruments Act, 1881. Whether the particular company's assets or conduct are protected by the BIFR order was held to be a matter for examination at the appropriate stage before the trial court, not in revisional jurisdiction at the threshold.

Conclusion: The objection that the prosecution was barred by the SICA was premature and was rejected; no interference was called for with the trial court's order.

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