The NCLAT Principal Bench on March 11, 2022, in the matter of Sikander Singh Jamuwal v. Vinay Talwar observed that there is no conflict between the section 17B of the Employees’ Provident Fund and Miscellaneous Provisions Act, 1952 (“PF Act”) and Insolvency & Bankruptcy Code, 2016 (“IBC”) and directed the Resolution Applicant to pay the Provident Fund dues (“PF”) to the employees.
The Appellant filed an appeal u/s 61 of IBC to set aside the resolution plan as it did not consider the full payment of PF to the employees under the PF Act.
The Tribunal observed:
“After reading Section 17-B of the PF & Miscellaneous Act, 1952 it is amply clear that Resolution Applicant is required to pay contribution and other sums due from the employer as per the provisions of the PF Act.”
The Tribunal relied on the judgment of NCLAT in Tourism Finance Corporation Ltd v. Rainbow Papers Ltd & Ors.
The Tribunal also held that the PF are not considered to be assets of the Corporate Debtor, as has been clarified by the Section 36(4)(a)(iii) of IBC.