SICA rehabilitation scheme overrides earlier consent terms and bars further recovery in execution proceedings.

A sanctioned rehabilitation scheme under SICA binds the sick company and its creditors, and section 32 gives the scheme overriding effect over inconsistent earlier consent terms. Where the claimant received circulation of the scheme and no timely objection was recorded, consent was deemed under section 19(2), and the claimant's entitlement stood crystallised under the scheme. Any challenge that the scheme wrongly curtailed the claim could not be pursued in civil execution proceedings because section 26 bars civil court jurisdiction in matters entrusted to the Board or Appellate Authority. The claimant was therefore not entitled to recover any further amount under the earlier consent terms, and the consequential discharge of the Court Receiver followed.

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Issues: Whether the sanctioned rehabilitation scheme under SICA governed the claimant's rights so as to bar recovery of further amounts under earlier consent terms and whether the executing court could grant the consequential relief of discharge of the Court Receiver.

Analysis: The claim arose in execution proceedings where the parties had earlier entered consent terms, but a subsequent rehabilitation scheme was sanctioned by the BIFR after circulation to the claimant. The Court held that under section 18(8) of SICA the sanctioned scheme binds the sick company as well as its creditors, and under section 19(2) consent is deemed where no response is received within time. The scheme therefore crystallised the claimant's entitlement, and section 32 gave SICA overriding effect over inconsistent rights flowing from earlier arrangements. The Court also held that any grievance that the scheme wrongly excluded or curtailed the claimant's claim could not be re-agitated in civil execution proceedings because section 26 bars civil court jurisdiction in matters the Board or Appellate Authority is empowered to determine. In view of the amount already paid and the scheme provisions, the claimant could not insist on further recovery under the earlier consent terms.

Conclusion: The rights of the claimant were held to be governed by the sanctioned scheme, and the claimant was not entitled to recover any further amount under the earlier consent terms; the consequential prayer for discharge of the Court Receiver was also granted.

Ratio Decidendi: A sanctioned scheme under SICA binds creditors and overrides inconsistent private arrangements, and a civil court cannot entertain execution claims that would in substance challenge the scheme's binding effect.

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