I finally could find a work around to upgrade from 2.3.3 to any of the higher versions when the moodle database is on MS SQL.
The issue is that the update script freezes on any query which is like:
UPDATE mdl_course_sectionsSET course='73', sequence=N'' WHERE id='78'
but if we run this query using the MS SQL Management Console before comitting the moodle upgrade then the moodle upgrade script passes this point and continues the upgrade unless if it needs to do another one of this update queries which will lead the update to freeze again. So, my work around was to run the following query using the MS SQL Management Console before running the moodle upgrade:
UPDATE mdl_course_sections SET sequence=N'' WHERE sequence is null;
This will do the magic and the moodle upgrade goes through after that.
Cheers,
Mohsen