Section 22 Sick Companies Act does not bar landlord eviction suits or require prior Board permission

Section 22(1) of the Sick Industrial Companies (Special Provisions) Act, 1985 does not bar a landlord's suit for possession and recovery of money against a sick company. A proceeding for eviction or a similar claim under rent control legislation remains maintainable, and prior permission of the Board is not required for such a suit. The stay order granted on the basis that Board permission was necessary was contrary to settled law and could not be sustained.

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Issues: Whether section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985 barred the landlord's suit for possession and recovery of money against the sick company.

Analysis: Section 22(1) does not create a bar to eviction or similar proceedings under rent control legislation. The binding position is that a landlord's proceeding against a tenant company remains maintainable despite the company being sick, and prior permission under section 22 is not required for such a suit. The order staying the suit on the footing that permission of the Board was necessary was therefore contrary to settled law.

Conclusion: The suit was not hit by section 22 of the Act, and the stay order could not be sustained. The challenge succeeded in favour of the petitioner.

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