Suppression of material facts and pending SICA reference did not justify staying implementation of a confirmed winding up order.

A collateral application to restrain implementation of a confirmed winding up order was treated as not maintainable because it suppressed the earlier winding up and appellate orders, omitted affected creditors, and was filed without demonstrated authority from the board after winding up. The Court also noted that pendency of a reference and inquiry before BIFR under SICA did not justify staying the Official Liquidator's possession proceedings, since those steps implemented binding orders already made and affirmed in appeal. The request to interfere with the winding up process was therefore rejected and the earlier directions were left undisturbed.

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Issues: (i) Whether the application was maintainable in view of suppression of material facts, non-joinder of affected creditors, and absence of valid authority in the officer filing it; (ii) Whether the pendency of a reference and inquiry before the BIFR under SICA barred the Official Liquidator from taking possession of the company's assets and warranted restraint against implementation of the winding up order.

Issue (i): Whether the application was maintainable in view of suppression of material facts, non-joinder of affected creditors, and absence of valid authority in the officer filing it.

Analysis: The application did not disclose the earlier winding up order and the later appellate order, though those orders directly affected the relief sought. The affected creditors were not impleaded. The officer who filed the application failed to produce a valid authority showing that the Board of Directors had empowered him to initiate the present proceedings after the winding up order. In such circumstances, the application suffered from maintainability defects.

Conclusion: The application was not maintainable and was liable to be dismissed.

Issue (ii): Whether the pendency of a reference and inquiry before the BIFR under SICA barred the Official Liquidator from taking possession of the company's assets and warranted restraint against implementation of the winding up order.

Analysis: Although Section 22 of SICA provides protection against continuation of certain proceedings during the pendency of a reference and inquiry, the Court noted that the company had already been ordered to be wound up and that order had been confirmed in appeal. The Official Liquidator's action was taken in implementation of those binding orders. The Court also noted the later filing before BIFR and observed that it could not, in the present proceedings, modify the order affirmed by the appellate court. The reliance placed on SICA did not justify the restraint sought.

Conclusion: The pendency of the BIFR reference did not entitle the applicant to the relief of staying the Official Liquidator's possession proceedings.

Final Conclusion: The Court refused to interfere with the winding up process and declined to grant any stay against the Official Liquidator's steps, leaving the earlier winding up directions undisturbed.

Ratio Decidendi: A collateral application cannot be entertained to restrain implementation of a confirmed winding up order where material facts are suppressed, necessary parties are omitted, and the applicant lacks authority to institute the proceeding; pendency of a SICA reference does not permit a coordinate court to modify binding winding up directions already affirmed in appeal.

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