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Issues: (i) Whether recovery steps by enforcing the bank guarantee or otherwise for customs dues against a company under BIFR proceedings were hit by Section 22(1) of the Sick Industrial Companies (Special Provisions) Act, 1985.
Analysis: The liability arose out of customs dues, and the attempted recovery by invoking the bank guarantee or by other coercive steps amounted to enforcement of a monetary claim against the company. As the company was subject to BIFR proceedings, such distress action fell within the protective sweep of Section 22(1), and the proper course was to seek appropriate orders from the BIFR before proceeding with recovery.
Conclusion: The recovery action could not be pursued without obtaining appropriate orders from the BIFR, and the objection to such enforcement succeeded.
Final Conclusion: Coercive recovery of customs dues against the company was treated as subject to the statutory bar under the sick industrial companies regime, leaving the petitioners to proceed before the BIFR.
Ratio Decidendi: Recovery or enforcement proceedings against a sick industrial company are barred by Section 22(1) of the Sick Industrial Companies (Special Provisions) Act, 1985 unless the required permission or order is obtained from the BIFR.
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