Initiation of proceeding u/s 14B & 7Q of EPF Act 1952 after Corporate Debtor admitted into CIRP is an offence punishable u/s 74(2) of IBC, NCLT grants liberty to Liquidator to approach IBBI to proceed against EPFO’s erred officials in this regard – Regional Provident Fund Commissioner Vs. Excel Glass Ltd. (Under Liquidation) – NCLT Kochi Bench
NCLT Kochi Bench held that:
(i) No claim has been presented by the applicant during the liquidation proceeding and the applicant also taken a stand that there is no need to file any claim, if this is the stand of the applicant then the question of rejection of claim does not arise at all. The applicant also has not filed this application under section 42 of IBC 2016, the specific provision available in IBC 2016 to prefer an appeal against the rejection of claim order, but this application is filed under the residuary provision of section 60(5) of IBC 2016.
(ii) In this case, the applicant initiated the proceeding under section 14B and 7Q of EPF Act 1952 after the corporate debtor admitted into CIRP, continued the proceeding and passed the order on 24.07.2019 and issued Recovery certificates dated 30.07.2019.
(iii) The applicant knowingly flouted the moratorium order and proceeded with the proceedings under sections 7Q and 14B of the Employees provident funds and Miscellaneous Provisions Act 1952, thus committed an offence punishable under section 74(2) of IBC, 2016. This section is criminal in nature falls under Chapter VII under the heading Offences and Penalties, under section 236(1) of IBC, 2016 special court alone have jurisdiction. Further under section 236 (2) of IBC, 2016 cognizance of the offence can be taken only on the compliant of IBBI or Central Government. Hence the 2nd respondent is granted liberty to approach the IBBI to proceed against the applicant’s erred officials in this regard.