law: Sick Industrial Companies (Special Provisions) Act, 1985
  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 2[and no suit
  
  for the recovery of money or for the enforcement of any security against the
  
  industrial company or of any guarantee in respect of any loans or advance
  
  granted to the industrial company] shall lie or be proceeded with further,
  
  except with the consent of the Board or, as the case may be, the appellate
  
  authority.
  (2) Where the management of the sick industrial company is taken
  
  over or changed 2[in pursuance of any scheme sanctioned under
  
  section 181, notwithstanding anything contained in the Companies Act, 1956, or
  
  any other law or in the memorandum and articles of association of such company
  
  or any instrument having effect under the said Act or other law- 
  (a) it shall not be lawful for the
  
  shareholders of such company or any other person to nominate or appoint any
  
  person to be a director of the company;
  (b) no resolution passed at any meeting of the
  
  shareholders of such company shall be given effect to unless approved by the
  
  Board.
  (3) 13[Where an inquiry under section 16 is pending
  
  or any scheme referred to in section 17 is under preparation or during the
  
  period] of consideration of any scheme under section 18 or where any such
  
  scheme is sanctioned thereunder, for due implementation of the scheme, the
  
  Board may by order declare with respect to the sick industrial company
  
  concerned that the operation of all or any of the contracts, assurances of
  
  property, agreements, settlements, awards, standing orders or other instruments
  
  in force, to which such sick industrial company is a party or which may be
  
  applicable to such sick industrial company immediately before the date of such
  
  order, shall remain suspended or that all or any of the rights, privileges,
  
  obligations and liabilities accruing or arising thereunder before the said
  
  date, shall remain suspended or shall be enforceable with such adaptations and
  
  in such manner as may be specified by the Board :
  PROVIDED  that such declaration shall not be made for a
  
  period exceeding two years which may be extended by one year at a time so,
  
  however, that the total period shall not exceed seven years in the aggregate.
  (4) Any declaration made under sub-section (3) with respect to a
  
  sick industrial company shall have effect notwithstanding anything contained in
  
  the Companies Act, 1956, or any other law, the memorandum and articles of
  
  association of the company or any instrument having effect under the said Act
  
  or other law or any agreement or any decree or order of a court, Tribunal,
  
  officer or other authority or of any submission, settlement or standing order
  
  and accordingly- 
  (a) any remedy for the enforcement of any
  
  right, privilege, obligation and liability suspended or modified by such
  
  declaration, and all proceedings relating thereto pending before any court,
  
  Tribunal, officer or other authority shall remain stayed or be continued
  
  subject to such declaration; and
  (b) on the declaration ceasing to have effect-
  
  
  (i) any right, privilege, obligation or
  
  liability so remaining suspended or modified, shall become revived and
  
  enforceable as if the declaration had never been made; and
  (ii) any proceeding so remaining stayed shall
  
  be proceeded with, subject to the provisions of any law which may then be in
  
  force, from the stage which had been reached when the proceedings became
  
  stayed.
  (5) In computing the period of limitation for the enforcement of
  
  any right, privilege, obligation or liability, the period during which it or
  
  the remedy for the enforcement thereof remains suspended under this section
  
  shall be excluded.