The Chennai Bench of the National Company Law Appellate Tribunal (NCLAT) has dominated that after a decision plan for a debt-laden company entity is authorised, even government-bodies just like the Employees Provident Fund Organisation (EPFO) can’t revise their claims.
The case pertains to insolvency proceedings in opposition to GVR Infra Projects Limited, which had not paid its EPFO dues since April 2014, together with curiosity and damages, although the identical was deducted from staff share.
As per guidelines of Insolvency and Bankruptcy Code (IBC), EPFO dues are a part of workmen salaries and dues, that are accorded the best precedence and are to be paid in full by the decision applicant when bidding for the corporate underneath company insolvency decision course of.
The Chennai Bench of NCLAT, nevertheless, held that for the reason that regional provident commissioner of EPFO had, whereas submitting the declare with the decision skilled, quoted a sure sum, the identical can’t be revised later, even when the overall dues excellent is larger than the sum quoted.
In its judgment, the NCLAT held that for the reason that provident commissioner had quoted a sure sum, the identical was thought of by the bidders whereas formulating the decision plan, which was then authorised by the National Company Law Tribunal (NCLT). Once the stated decision plan is authorised, a revision in claims can’t be permitted as that will imply altering the construction of the authorised plan as soon as once more.
“Once a resolution plan is duly approved by the Adjudicating Authority (NCLT) the claims as provided in the resolution plan shall stand frozen and will be binding on the corporate debtor and its employees, members, creditors, including the central government, any state government or any local authority, guarantors and other stakeholders,” the NCLAT held.
The Chennai Bench additionally stated that after the plan is authorised, all claims made by any individuals or authorities stand extinguished.
“No person is entitled to initiate or continue any proceeding regarding a claim that is not part of the Resolution Plan,” the Bench stated.
EPF is a statutory due paid to each worker working in a company organisation with at the least 20 staff. As per the principles of EPFO, each the worker and the employer contribute an equal sum in the direction of a corpus. This corpus is maintained and sorted by the EPFO. When the stated worker retires, a lump sum quantity, which incorporates the contributions made by each the events and contains the curiosity earned on the cash deposited, is then paid the worker.
As per the present guidelines, staff incomes lower than Rs 15,000 per 30 days of primary pay need to mandatorily develop into a member of the EPF, whereas these incomes above that sum can select to develop into a member with permission from the assistant provident fund commissioner, if each the worker and the employer agree.
The present norms say that the employer has to pay 12 per cent of primary wages plus dearness and retaining allowance into the EPF of the worker, which is to be matched by the worker.
