{"id":296791,"date":"2023-07-14T12:00:55","date_gmt":"2023-07-14T06:30:55","guid":{"rendered":"https:\/\/www.scconline.com\/blog\/?p=296791"},"modified":"2023-07-17T09:11:54","modified_gmt":"2023-07-17T03:41:54","slug":"employees-provident-fund-gratuity-dues-even-if-funds-not-available-with-liquidator-nclat","status":"publish","type":"post","link":"https:\/\/www.scconline.com\/blog\/post\/2023\/07\/14\/employees-provident-fund-gratuity-dues-even-if-funds-not-available-with-liquidator-nclat\/","title":{"rendered":"Employees entitled to Provident Fund and Gratuity Fund dues even if funds not available with Liquidator: NCLAT"},"content":{"rendered":"<div style=\"text-align: justify; line-height: 150%;\">\n<p style=\"margin-bottom: 3%;\"><b>National Company Law Appellate Tribunal, Chennai:<\/b> In a case related to approval of Resolution Plan without admitting full claim including provident fund and gratuity dues, a Division Bench comprising of M. Venugopal, J. and <b>Ms. Shreesha Merla* (Technical Member)<\/b>, directed to include both Provident Fund and Gratuity Fund which is to be paid in full in the &#8216;Resolution Plan&#8217;.<\/p>\n<p><b>Brief Facts<\/b><\/p>\n<p style=\"margin-bottom: 3%;\">In the instant case, the Adjudicating Authority vide order dated 29-02-2021, approved the Resolution Plan as preferred by the Resolution Professional (RP). The RP vide an email dated 09-02-2021 informed the appellant that his claim was admitted only to the extent of 35.13% of the total admitted claim of Rs. 30,46,31,880\/-. Aggrieved by the impugned order dated 29-02-2021, approving the Resolution Plan admitting appellant&#8217;s claim to the extent of 35.13%, the appellant preferred the present appeal before the NCLAT challenging the same.<\/p>\n<p><b>Moot Point<\/b><\/p>\n<p style=\"margin-bottom: 3%;\">Whether the Provident Fund and Gratuity dues of the appellant are to be paid in full?<\/p>\n<p><b>Court&#8217;s Verdict<\/b><\/p>\n<p style=\"\">While relying on <i>Jet Aircraft Maintenance Engineers Welfare Assn.<\/i> v. <i>Ashish Chhawchharia<\/i>, <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-9001295557\" target=\"_blank\" rel=\"noopener\">2022 SCC OnLine NCLAT 418<\/a>, the NCLAT opined that both Provident Fund and Gratuity Fund is to be paid in full as per the provisions of the <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0002796571\" target=\"_blank\" rel=\"noopener\">Employees Provident Funds and Miscellaneous Provisions Act, 1952<\/a> and Payment of Gratuity Act, 1972.<\/p>\n<p style=\"margin-left: 36pt; margin-bottom: 3%;\"><b>&#8220;&#8230;the share of workmen dues shall be kept outside the Liquidation assets and the concerned workmen \/ Employees shall have to be paid the same, out of such Provident fund, Gratuity Fund, if any available. The words, &#8216;if any available&#8217;, cannot be read to mean that the workmen and empolyees are not entitled for Provident fund, Gratuity Fund, Pension fund, if not available with the Liquidator.&#8221;<\/b><\/p>\n<p style=\"margin-bottom: 3%;\">The NCLAT allowed the present appeal and directed to include these amounts in the &#8216;Resolution Plan&#8217;.<\/p>\n<p style=\"margin-bottom: 3%;\">[<span style=\"font-weight: bold; color: #632423;\">Central Board of Trustees v. Shri Kumar Rajan, <a href=\"http:\/\/www.scconline.com\/DocumentLink\/FrFyGDGN\" target=\"_blank\" rel=\"noopener\">2023 SCC OnLine NCLAT 284<\/a>, order dated 21-06-2023<\/span>]<\/p>\n<p style=\"text-indent: 18pt;\"><strong><span style=\"color: #000080;\">*Judgment by Ms. Shreesha Merla (Technical Member)<\/span><\/strong><\/p>\n<hr\/>\n<p>Advocates who appeared in this case:<\/p>\n<p style=\"margin-left: 18pt;\">Mr. R. Vishnu, Counsel for the Appellant;<\/p>\n<p style=\"margin-left: 18pt;\">Mr. P.V. Vinod, Counsel for the Respondent No. 1.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p><i>NCLAT held that the Provident Fund and Gratuity dues of the appellant are to be paid in full.<\/i><\/p>\n","protected":false},"author":67514,"featured_media":293392,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[3,11],"tags":[34532,59321,30182,22014,7011,30228],"class_list":["post-296791","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-casebriefs","category-tribunals_commissions_regulatorybodies","tag-gratuity-fund","tag-ms-shreesha-merla-technical-member","tag-national-company-law-appellate-tribunal","tag-nclat","tag-provident-fund","tag-resolution-plan"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v27.4 (Yoast SEO v27.4) - 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