Right Engineers and Equipment India Pvt. Ltd.

The dues of workmen/employees from Provident Fund do not come within the meaning of ‘Liquidation Estate’ for the purpose of distribution of assets u/s 53 of IBC and the damages levied by EPFO u/s 14B of the EPF & MP Act, 1952 which are dues of Government and will be paid in order of priority u/s 53 of IBC, 2016 – Shri Addanki Haresh Liquidator of Right Engineers and Equipments India Pvt. Ltd. Vs.  Recovery Officer, Employees Provident Fund Organisation – NCLT Bengaluru Bench

In this important judgment on treatment of claim/demand and penalty raised by EPFO, NCLT Bengaluru Bench held that:
(i) The demand/claim raised prior to the moratorium will not form part of liquidation estate and should be paid in priority; secondly, the claim/demand and penalty raised during moratorium period is not allowable under the provisions of the IBC; and the penal damages claimed under Section14B of EPF & MP Act, 1952 which is prior to the moratorium period will be treated under Section 53 of IBC, 2016.
(ii) The dues of workmen or employees from the provident fund do not come within the meaning of ‘liquidation estate’ for the purpose of distribution of assets under Section 53 of the Code. Accordingly, it is to be paid in priority over other dues.
(iii) The damages levied by EPFO under Section 14B of the EPF & MP Act 1952 which are dues of Government and will be paid in order of priority under Section 53 of IBC, 2016.

The dues of workmen/employees from Provident Fund do not come within the meaning of ‘Liquidation Estate’ for the purpose of distribution of assets u/s 53 of IBC and the damages levied by EPFO u/s 14B of the EPF & MP Act, 1952 which are dues of Government and will be paid in order of priority u/s 53 of IBC, 2016 – Shri Addanki Haresh Liquidator of Right Engineers and Equipments India Pvt. Ltd. Vs.  Recovery Officer, Employees Provident Fund Organisation – NCLT Bengaluru Bench Read Post »

NCLT directs u/s 43 of IBC the suspended Directors to restore the amounts as prayed by the Liquidator – Addanki Haresh RP M/s. Right Engineers and Equipments Pvt. Ltd. Vs. H.P. Arun Kumar  – NCLT Bengaluru Bench

Mr. Addanki Haresh in his capacity as Resolution Professional filed and application under Section 43, and followed up the same during the Liquidation period, in his capacity as Liquidator. A single application was filed against Three directors of the Company, with a prayer to reverse the Advances paid to the Directors. The initial Forensic Audit Report identified transactions against Two directors only, and later a supplemental Report was obtained against the transactions with the Third related party and additional prayers were included against the Third related party. The submissions were supported with copies of Bank Statements. The Respondents took a technical objection that the Forensic Audit Report contained certain “Disclaimers, Exclusions and Limitations”, but did not dispute the existence of such Transactions. Hence, the Adjudicating Authority allowed the application under Section 43 and directed the Respondents to restore the amounts as prayed by the Liquidator.

NCLT directs u/s 43 of IBC the suspended Directors to restore the amounts as prayed by the Liquidator – Addanki Haresh RP M/s. Right Engineers and Equipments Pvt. Ltd. Vs. H.P. Arun Kumar  – NCLT Bengaluru Bench Read Post »

An axiomatic principle in law that the ‘Tribunal’ is required to consider the ‘sufficiency of cause’, whether the cause ascribed is reasonable looking to all the facts of the matter – The Assistant Commissioner of Commercial Taxes Vs. Right Engineers & Equipment India Pvt. Ltd. Rep. Liquidator, Mr. Addanki haresh – NCLAT Chennai

NCLAT dismissed the appeal and held that it is an axiomatic principle in law that the ‘Tribunal’ is required to consider the ‘sufficiency of cause’, whether the cause ascribed is reasonable looking to all the facts of the matter. However, the aspect of an existence of ‘sufficient cause’ is to be determined based on the facts and circumstances hovering around particular case. Indeed, there ought not to be an ‘inaction’ or ‘want of bonafide’ or no negligence attributable to a litigant/party, as the case may be. It cannot be forgotten that the Liquidator by adverting to the Regulation 16(A) Regulations 2016 (Liquidation Process) had rejected the claim through his letter on 17.03.2021 mentioning that the claims required to be furnished on or before 11.01.2021. Unfortunately, the Appellant/Applicant had submitted its claim only on 04.03.2021.

An axiomatic principle in law that the ‘Tribunal’ is required to consider the ‘sufficiency of cause’, whether the cause ascribed is reasonable looking to all the facts of the matter – The Assistant Commissioner of Commercial Taxes Vs. Right Engineers & Equipment India Pvt. Ltd. Rep. Liquidator, Mr. Addanki haresh – NCLAT Chennai Read Post »

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