Sick industrial company protection versus debt recovery law: Section 22 did not bar recovery proceedings in the stated facts.

Section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985 suspends specified proceedings during the pendency of inquiry, scheme preparation, implementation or appeal under that Act, but the article explains that this protection did not bar recovery steps already taken after ex parte adjudication under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 and the Second Schedule to the Income Tax Act, 1961. It further notes that the competing non-obstante clauses were read with the objects of both statutes, and the later recovery legislation was treated as prevailing where reconciliation was not possible. On that basis, the recovery statute was given primacy, and the separate opinion also found Section 22 inapplicable on the procedural timeline.

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Issues: Whether the recovery proceedings under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 were barred by Section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985, and whether the later recovery statute prevailed over the sick industrial companies legislation.

Analysis: Section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985 suspends certain proceedings against an industrial company when inquiry, scheme preparation, implementation, or appeal under that Act is pending. The dispute arose in the context of recovery proceedings already reduced to an ex parte adjudication, followed by steps under Section 29 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 and the Second Schedule to the Income Tax Act, 1961. The Court examined the competing non-obstante clauses in Section 32 of the 1985 Act and Section 34 of the 1993 Act, the object of both enactments, and the principle that a later special statute may prevail where reconciliation is not possible. It held that the recovery enactment was intended to secure expeditious adjudication and recovery of debts due to banks and financial institutions, and that its overriding clause, read with the express saving in Section 34(2), gave it primacy over the 1985 Act in the facts of the case. The separate opinion reached the same result by holding that Section 22 was in any event not attracted on the timeline of the proceedings.

Conclusion: Section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985 did not bar the recovery proceedings, and the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 prevailed on the issue.

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