Preferential payments in winding up: statutory employee and public claims receive priority over other creditors. The provision prescribes categories of preferential payments in winding up-statutory dues to government, specified employee claims (wages, accrued holiday remuneration, provident/pension/gratuity fund sums), employer social-welfare contributions, Workmen's Compensation liabilities, and investigation expenses-that rank equally and have priority over debenture holders under any floating charge; they abate proportionately if assets are insufficient, are to be discharged promptly subject to winding up costs, and, where distraint occurred shortly before winding up, form a first charge on the distrained goods or proceeds.
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Provisions expressly mentioned in the judgment/order text.
Preferential payments in winding up: statutory employee and public claims receive priority over other creditors.
The provision prescribes categories of preferential payments in winding up-statutory dues to government, specified employee claims (wages, accrued holiday remuneration, provident/pension/gratuity fund sums), employer social-welfare contributions, Workmen's Compensation liabilities, and investigation expenses-that rank equally and have priority over debenture holders under any floating charge; they abate proportionately if assets are insufficient, are to be discharged promptly subject to winding up costs, and, where distraint occurred shortly before winding up, form a first charge on the distrained goods or proceeds.
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