Later stay orders do not undo prior SARFAESI measures once statutory abatement of the BIFR reference has occurred.

A later stay on further proceedings does not nullify measures already taken by a secured creditor under section 13(4) of the SARFAESI Act. Where secured creditors representing not less than three-fourths in value have already taken such measures, the third proviso to section 15(1) of the Sick Industrial Companies (Special Provisions) Act, 1985 is triggered and the pending BIFR reference abates. The stay only restrained future action and did not revive or preserve the reference. The contrary view that the earlier SARFAESI action was invalidated by the stay was held unsustainable.

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Issues: Whether a stay granted by the Debt Recovery Appellate Tribunal on further proceedings could invalidate or nullify measures already taken by the secured creditor under section 13(4) of the SARFAESI Act, so as to prevent abatement of the reference pending before the Board for Industrial and Financial Reconstruction under the third proviso to section 15(1) of the Sick Industrial Companies (Special Provisions) Act, 1985.

Analysis: The secured creditor had already issued notice under section 13(4) of the SARFAESI Act and had taken possession before the later appellate stay. The stay order was understood as operating only against further action and not as undoing the measures already taken. Under the third proviso to section 15(1) of the Sick Industrial Companies (Special Provisions) Act, 1985, a pending reference abates once secured creditors representing not less than three-fourths in value have taken measures under section 13(4). Since that statutory condition had already been satisfied, the subsequent stay did not revive or preserve the BIFR reference.

Conclusion: The stay order did not invalidate the earlier SARFAESI action, and the BIFR reference had abated; the appellate authority's contrary view was unsustainable.

Final Conclusion: The writ petition succeeded, and the order of the appellate authority was set aside because the statutory abatement under the special rehabilitation law had already occurred upon prior action under the securitisation law.

Ratio Decidendi: A later stay against further proceedings does not undo measures already taken under section 13(4) of the SARFAESI Act, and once the statutory threshold under the third proviso to section 15(1) of the Sick Industrial Companies (Special Provisions) Act, 1985 is met, the pending reference abates.

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