Hire purchase repossession is outside the statutory stay where the machinery remains the financier-owner's property.

Section 22(1) of the Sick Industrial Companies (Special Provisions) Act, 1985 does not bar a financier-owner's suit seeking injunction to prevent interference with repossession of machinery supplied under a hire purchase arrangement, because the action concerns the owner's property and not proceedings against the sick company's property. The statutory stay applies to winding up, execution, distress, recovery of money, enforcement of security, and similar proceedings against the sick company's assets, but not to repossession of hired machinery by its true owner. The stay granted by the court was therefore unsustainable and was set aside.

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Issues: Whether section 22(1) of the Sick Industrial Companies (Special Provisions) Act, 1985 barred a suit by the financier-owner seeking to prevent interference with repossession of machinery given under hire purchase.

Analysis: Section 22(1) stays proceedings for winding up, execution, distress or like proceedings against the properties of the sick company, suits for recovery of money, enforcement of security, and guarantees. The suit in question was not one for recovery of money or enforcement of security, but a suit for injunction to facilitate repossession of machinery whose ownership remained with the financier under the hire purchase arrangement. The protection under section 22(1) applies where the action is against the property of the sick company; it does not extend to the owner's own property merely because possession is with the sick company. The authorities relied on consistently recognise that repossession by the owner of hired machinery is outside the statutory bar.

Conclusion: Section 22(1) did not apply, and the stay of suit proceedings was unsustainable. The order granting stay was set aside and the revision petition was allowed.

Ratio Decidendi: Section 22(1) of the Sick Industrial Companies (Special Provisions) Act, 1985 does not bar proceedings by the owner of hired machinery to repossess its own property from a sick industrial company, because such proceedings are not proceedings against the property of the sick company.

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