Statutory bar under the sick company regime prevents winding up proceedings while a BIFR reference remains pending.

A pending reference before the Board for Industrial and Financial Reconstruction triggered the statutory bar under section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985, preventing a winding up petition under section 433(e) of the Companies Act, 1956 from proceeding at that stage. The creditor was required to participate in the sick company proceedings and await the outcome of the reference, with any further remedy to depend on how that reference was decided. The winding up petition was therefore not maintainable during the pendency of the reference, and the matter was disposed of with directions for expeditious consideration by the Board.

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Issues: Whether a winding up petition under section 433(e) of the Companies Act, 1956 could proceed when a reference under sections 15 and 16 of the Sick Industrial Companies (Special Provisions) Act, 1985 was pending and the bar under section 22 of that Act operated.

Analysis: The pending reference before the Board for Industrial and Financial Reconstruction attracted the statutory embargo under section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985. In view of that bar, the Court held that it could not proceed with the winding up petition at that stage. The proper course was for the creditor to participate in the proceedings before the Board and await the outcome of the reference, with liberty to pursue remedies in accordance with law depending on how the reference was decided.

Conclusion: The winding up petition was not maintainable during the pendency of the reference and was disposed of accordingly, with directions for expeditious disposal of the reference by the Board.

Final Conclusion: The statutory protection under the sick industrial company regime prevailed over the winding up request, leaving the creditor to pursue its remedy before the specialised forum until the reference was decided.

Ratio Decidendi: Where a reference under the Sick Industrial Companies (Special Provisions) Act, 1985 is pending, section 22 operates as a bar to winding up proceedings and the creditor must seek relief in the pending sick company process.

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