CELVEL ENTERPRISES Vs. M/S ELCONMENT LIMITED

JUDGEMENT

(1.) THIS is an application filed under Order 14, Rule 8 of Original Side Rules, read with Order S. 38, Rule, 5 of Civil Procedure Code against the respondent and Garnishees seeking the relief of issuing a prohibitory order to the Garnishees herein not to disburse the amount payable to the defendant/respondent and direct them to deposit the amount payable by them to the credit of the suit.

(2.) THE short facts of the applicant's case is that the applicant herein is the plaintiff who in the capacity of ?Selling Agent? of the defendant/respondent by virtue of an appointment order issued in the year 1987, worked as an agent for marketing the products manufactured by the defendant/respondent throughout the State of Tamil Nadu, Kerala and Karnataka and with great efforts, the applicant had marketed the goods to a vast extent and that for the goods an marketed during the year 1987-88, the commissio n, as per the appointment order, comes to the extent of Rs. 1,62,557.18 which became payable to the plaintiff/applicant and that in spite of the repeated demands and requests, the said commission has not been paid to them and that consequently, the suit has been filed for the recovery of the said amount and that even so, the present application was filed for the relief prayed therein on the ground that the defendant's company has become sick and than the matter has been referred to the Board for Industrial and Financial Reconstruction (BIFR), Calcutta as it become heavily indebted and that the total loss sustained by the defendant is Rs. 1,31,53,640.32 as on 31-3-1989 inclusive of investment allowance of Rs. 45,52,000/- and that in such an event, the applicant hereby apprehended that he would not be in a position to realise the fruits of the decree in case if it is passed for the recovery of the suit claim and that therefore, the amount of Rs. 9,34,746.90 due by the first Garnishee to the defendant and a sum of Rs. 2,00,000/-due by the second Garnishee to the defendant still remained intact and that an interim prohibitory order was sought for prohibiting the disbursement of the said amount to the respondent, pending disposal of the suit. Para-16 ot the affidavit disclosed the fact further that the defendant company is financially in a crippled condition, being owned by the Government Promoters and that in case a decree is passed, under such situation, the applicant/plaintiff may not be able to recover the claim made in the suit.

(3.) IN para-14 of the affidavit filed in support of the application, the plaintiff/applicant has admitted that the defendant company is a sick industrial company, financially in a crippled condition, seeking the relief by referring the matter to the Board for INdustrial and Financial Re-construction under the Sick INdustrial Companies (Special Provisions) Act, 1986. So much so, it was the case of the defendant that under S. 16 of the Sick INdustrial Companies (Special Provisions) Act, 1986, proceedings were taken to the Board for INdustrial and Financial Re-construction and that inasmuch as the same is pending and the reliefs are going to be granted, it was the contention of the defendant among the other pleas that no legal proceedings, including the present application and suit are entertainable in this court and that as such, the bar provided in the abovesaid Act is squarely applicable to the present case also. IN this context of admitting that the defendant, public limited company is a sick industrial unit and the relief and concession for the said factory are being initiated before the Board for INdustrial and Financial Re-construction, under S. 16 of the Sick INdustrial Companies (Special Provisions) Act, 1986, hereinafter called the Act, S. 22 has become more relevant which reads as follows:?