TaxTMI 
TaxTMI 
2000 (7) TMI 844
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....ondents in repayment of lease rentals and, therefore, sought permission for the receiver to be appointed by this Court to take over the possession of the said equipment which was given on lease to the respondents under lease agreement dated 24-3-1993. This application has been resisted by the respondents/lessees by stating in their reply that the appointment of a receiver is hit by the provisions of section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985 (the "said Act"). 2. The learned counsel for the petitioner has relied upon a judgment of the learned Single Judge of this Court in Credit Capital Finance Corpn. v. Foremost Industries Ltd. [1996] 87 Comp. Cas. 251 . Construing the judgment of Shree Chamundi Mopeds Ltd....
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....h vested with the financial company by which the equipment has been leased out, the provisions of section 22 would not apply because such provisions only apply to the property of the lessee company and the equipment which was leased could not be said to be the property of the company. The learned Single Judge has after construing the clauses of the lease of the equipment held as follows : "A perusal of these clauses shows that the ownership of the machinery vested with the petitioner though possession of the same was with the respondent. Merely putting the possession of the machinery at the disposal of the respondent by no stretch of imagination would mean that the ownership of the property vested in the respondent-company. Since the res....
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....ppeal No. 29 of 1998 by the order dated 9-10-1998, apply with full force to the facts of the present case. The petitioner has also relied upon the judgment of the learned Single Judge in the case of Kotak Mahendra Finance Ltd. v. Deve Paints Ltd. AIR 1997 Bom. 401, to contend that section 22 would not apply to the facts of the present case. The Bombay High Court held that financed vehicles which are not owned by the sick company do not fall within the purview of section 22. The learned Single Judge held as follows : "The answerable question, therefore, is whether the properties which are not owned by the sick industrial undertaking, are covered under section 22(1) of the Act of 1985 ? If the finance company resorts to recovery of its pro....
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.... granted to the lessee company." (p. 404) 6. The bar contemplated by the relevant portion of section 22 reads as under : ". . . no proceedings for the winding-up of the industrial company or for execution, distress or the like against any of the properties of the industrial company or for the appointment of a receiver in respect thereof." 7. Thus, even section 22 of the Act in terms refers only to the properties of the company. 8. The plea of the respondents, if accepted would defeat the very purpose of leasing out the equipment by the petitioner as the leased equipment was purchased initially by the petitioner-company from its own funds and was then leased out to the respondent-company. Such a construction would affect unfairly....