A liquidation estate does not include the sums due to any workman or employee from the Provident Fund etc. – The Central Board of Trustees, EPF Vs. The Liquidator (Sri. Gorur Narasimhamurthy Venkataraman) M/s. Bunt Solar India Pvt. Ltd. – NCLAT Chennai

The main contention of the Appellant is that Section 53 of the IBC is not applicable in the case of EPF. Since the Employees Provident Fund Act is a special Act and prevails over all other acts and submits that the dues which are payable to the employees cannot be treated as part of the asset of the Corporate Debtor. NCLAT held that there is no dispute with regard to that and we are in agreement with the said position of law. Even Section 36(4(a)(iii)) of Code 2016 states that the following shall not be included in the ‘Liquidation Assets’ and shall not be used for recovery in the liquidation Sub Section: (4) of Section:36 of IBC reads as “The following shall not be included in the Liquidation Estate assets and shall not be used for recovery in the Liquidation. Sub Clause (iii) of clause (b) of sub-Section (4) of Section 36 reads as under, “All sums due to any Workman or employee from the provident fund, the pension fund and the gratuity fund”. From reading of this provision, it is clear that a liquidation estate does not include the sums due to any workman or employee from the Provident Fund etc.

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