JUDGMENT 1. - A short question is involved whether once an inquiry under Section 16 of the Sick Industrial Companies (Special Provisions) Act, 1985 (for short, the Act) is started and is pending and the older under Section 17 of the Act is made, scheme under Section 17 of the Act is prepared and the scheme was implemented, whether the company petition filed in this court under Section 439 read with Section 433 of the Companies Act, 1956 (for short the Companies Act), should only be stayed or should be dismissed. 2. The respondent, Saral Synthetics (Rajasthan) Ltd. Alwar, according to the petitioner, owns to it a sum of about Rs.96,000/- as the price of different kinds of dyes and chemicals supplied to non-petitioners company by the petitioner. Despite a notice, the amount was not paid. Therefore, the non-petitioner company is unable to pay its debts. This Court ordered the issue of a notice to the non-petitioner company as to why the petition be not admitted and published. Consequent to notice the non-petitioner company in respect of whom a winding up order has been sought, submitted an application under Section 72 read with Section 16 and 17 of the Act, wherein it was mentioned that a reference was made by the non-petitioner company to the Board of Industrial and Financial Reconstruction Establishment u/s 15 of the Act and the non-petitioner company has received a letter to that effect. The reference was registered as No. 179/88. According to that application of the non-petitioner company in view of the provisions of Section 22 of the Act, no proceedings for the winding up the industrial company shall lie or proceeded with further. In the instant case, the non-petitioner company is registered by the Board and the inquiry is pending. Therefore, the company petition is liable to be dismissed, or stayed till the decision of the Board. 3. I will revert to the question formulated in the beginning of this order. The contention of Mr. Joshi, learned counsel for the petitioner is that this company petition was filed in this court on December 16, 1987 and in order to defeat these proceedings, later on an application under Section 16 of the Act was filed before the Board. Therefore, at best the proceedings should be stayed and should not be dismissed. 4. The contention of Mr. Joshi, learned counsel for the petitioner is that this company petition was filed in this court on December 16, 1987 and in order to defeat these proceedings, later on an application under Section 16 of the Act was filed before the Board. Therefore, at best the proceedings should be stayed and should not be dismissed. 4. On a perusal of the application filed by the non-petitioner company as well as the documents annexed with it i.e. the order dated January 31, 1989 of the Board it will be seen that in respect of the company non-petitioner a case (No. 179/88) was registered and an inquiry was initiated under section 16 (1) of the Act and therefore the Board is satisfied that the non-petitioner company has become a sick industrial company within the provisions of Section 3 (1) (o) of the Act. The reasons have been given by the Board in its order passed separately. It further appears that some package was prepared by the I.D.B.I. but the same could not be implemented by the Banks. The Board, therefore, observing that it finds that there is still good demand for the company's product there is no difficulty in the easy availability of raw material and the families of about 729 employees, depend on the company for their livelihood, substantial revenue payable both to the Central and State Governments is involved. Large amount of dues of the financial institutions and Panics are at stake, reasonable grounds exit for exploring the possibility of revival/rehabilitation for adopting suitable measures including amalgamation of the sick industrial company with any other healthy unit of the group. In exercise of the powers conferred on it, the Board appointed the IDBI as the operating agency to prepare a scheme for rehabilitation/revival of the company. Section 22(1) of the Act now may be reads which read as under : 22. Suspension of legal proceedings, contracts etc. In exercise of the powers conferred on it, the Board appointed the IDBI as the operating agency to prepare a scheme for rehabilitation/revival of the company. Section 22(1) of the Act now may be reads which read as under : 22. Suspension of legal proceedings, contracts etc. (1) where in respect of an industrial company an inquiry under Section 16 is pending or any scheme referred to under section 17 is under preparation or consideration or a sanctioned scheme is under implementation or where an appeal under section 25 relating to an industrial company is pending, then notwithstanding anything contained in the Companies Act, 1956, or any other law or the Memorandum and articles of association of the industrial company or any other instrument having effect under the said Act or other law, 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 shall lie or be proceeded with further, except with the consent of the Board, or as the case may be, the Appellate Authority. A perusal of the aforesaid extracted sub-section (1) of Section 22 of the Act will show that when an inquiry under Section 16 of the Act is pending or scheme referred to under Section 17 is under preparation or consideration, or a sanctioned scheme is under its implementation, then notwithstanding anything contained in the Companies Act or any other law or the Memorandum and Articles of Association of the industrial company or any other instrument having the effect under the said Act or law, 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 appointment of a receiver in respect thereof shall lie, or be proceeded with further, except with the consent of the Board, or as the case may be, the appellate authority. Therefore, the proceedings will either not lie or will not be proceeded further. In the instant case as stated earlier, the company petition has been filed, before even an application was made by the non-petitioner company before the Board and the Board initiated inquiry under Section 16 (1) of the Act or made an order under Section 17 of the Act. In the instant case as stated earlier, the company petition has been filed, before even an application was made by the non-petitioner company before the Board and the Board initiated inquiry under Section 16 (1) of the Act or made an order under Section 17 of the Act. But even if that be so, the words 'shall be proceeded further' in my opinion go to show that the proceedings cannot be continued further except with the consent of the Board or the appellate authority, as the case may be. It may be stated that neither the petitioner has taken the consent of the Board to this effect that the proceedings may be proceeded further, nor he has filed any appeal and therefore has not sought the consent of the appellate authority. There are provisions contained for winding up in the Act itself and a reference in this connection will be made to Section 20 of the Act. Sub-section (1) of Section 20 provides that where in relation to an inquiry scheme, the circumstances so require the Board after making inquiry under Section 16 and after consideration of all the relevant facts and circumstances and after giving an opportunity of being heard to all concerned parties is of the opinion that it is just and equitable that the sick industrial company should be wound up, it may record and forward its opinion to the concerned High Court. Under sub-section (2) of Section 20 the High Court shall on the basis of the opinion of the Board order winding up of the sick industrial company and may proceed and cause to proceed with the winding up of the sick industrial company in accordance with the provisions of the Companies Act. Under sub-section (3) of Section 20, for the purpose of winding up of the sick industrial company, the High Court may appoint any officer of the operating agency, if the operating agency gives its consent as the liquidator of the sick industrial company and the officer so appointed shall for the purposes of the winding up of the sick industrial company be deemed to be and have all the powers of the official liquidator under and the Companies Act. Sub-section (4) of Section 20 of the Act further provides that notwithstanding anything contained in sub section (2) of (?) sub-section (3) the Board may cause to be sold the assets of the sick industrial company in such manner as it may deem fit and forward the sale proceeds to the High Court for orders for distribution in accordance with the provisions of section 529-A. and other provisions of the Companies Act. It will therefore be clear that the power is vested in the Board and if it is of opinion that it is just and equitable that the sick industrial company should be wound up, it may record and forward its opinion to the concerned High Court, who on the basis of the opinion of the Board shall order winding up of the sick industrial company in accordance with the previsions of the Companies Act. It will therefore be clear that there being special provisions in the Act itself in respect of winding up of a sick industrial company, the orders for winding up arc to be passed in accordance with those provisions. A similar matter came up before the Gujarat High Court in the case of Testeels Ltd. Ahmedabad v. Rathaban Ranchhodlal Charitable Trust, Ahemdabad AIR 1988 Gujarat 21 , and the court said that under Section 22 of the Act the winding up proceedings already stated against an Industrial Company can be dismissed. The words 'be proceeded with further' in Section 22 cannot be interpreted to mean that the winding up proceedings already started should be kept in abeyance without further proceeding in the matter. The court said that the words 'or be proceeded with' occurring in Section 22 cannot, in any way, restrict the meaning that has to be given to the words 'no proceedings shall lie'. Therefore, in my opinion, it is not necessary that the proceedings should be kept in abeyance and they can be dismissed. 5. Consequently, I hereby allow the application filed by the non-petitioners and dismiss the company for the aforesaid reason.Application Allowed/company Petition Dismissed. *******