Provident fund first charge prevails over prior pledge, and statutory dues include interest and damages.

A pledge transfers only special property to the pawnee, while general ownership remains with the employer, so pledged goods may still form part of the establishment's assets for provident fund recovery. Section 11(2) of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 creates a first charge on the assets of the establishment and gives provident fund dues priority over all other debts, including prior secured claims such as a pledge. The expression "any amount due" also includes interest under Section 7Q and damages under Section 14B, ensuring the recovery mechanism covers the full statutory dues package.

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Issues: (i) Whether sugar bags pledged with a bank remained assets of the establishment and could be attached and sold for recovery of provident fund dues under the Employees' Provident Funds and Miscellaneous Provisions Act, 1952; (ii) whether the statutory first charge and priority under Section 11 of the Act override a prior pledge and other secured debts; (iii) whether interest under Section 7Q and damages under Section 14B form part of the amount due for the purposes of Section 11(2).

Issue (i): Whether sugar bags pledged with a bank remained assets of the establishment and could be attached and sold for recovery of provident fund dues under the Employees' Provident Funds and Miscellaneous Provisions Act, 1952.

Analysis: A pledge under the law of bailment transfers only special property to the pawnee, while general ownership remains with the pawnor. The deed of pledge showed that the sugar mill retained custody-related responsibilities, including preservation, insurance, rent, and liability for loss or shrinkage, which indicated that title did not pass to the bank. The sugar bags therefore continued to be movable property of the establishment and fell within the assets against which recovery could be pursued.

Conclusion: The pledged sugar bags remained assets of the establishment and were liable to attachment and sale for recovery of provident fund dues.

Issue (ii): Whether the statutory first charge and priority under Section 11 of the Act override a prior pledge and other secured debts.

Analysis: Section 11(2) declares that any amount due from an employer shall be the first charge on the assets of the establishment and shall be paid in priority to all other debts. The expression "all other debts" was held to include secured as well as unsecured debts, and the non obstante clause was treated as sufficient to override competing private claims, including a pledge. Since the Act is a social welfare legislation, the provision was construed purposively to protect workers' provident fund dues from defeat by prior security interests.

Conclusion: The statutory first charge under Section 11(2) prevails over a prior pledge and other secured debts.

Issue (iii): Whether interest under Section 7Q and damages under Section 14B form part of the amount due for the purposes of Section 11(2).

Analysis: The expression "any amount due from an employer" was read in the light of the scheme of the Act, including the provisions for determination of dues, interest for delayed payment, and damages for default. Excluding interest and damages would undermine the recovery mechanism and frustrate the statutory object of ensuring prompt payment of workers' dues. The amount due was therefore construed broadly to include interest and damages as well as the principal contribution.

Conclusion: Interest under Section 7Q and damages under Section 14B are included within the amount due for Section 11(2).

Final Conclusion: The provident fund authorities were entitled to recover their dues from the sale proceeds of the pledged sugar bags in preference to the bank's claim, and the statutory recovery package included principal contribution, interest, and damages.

Ratio Decidendi: Under Section 11(2) of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952, provident fund dues constitute a first charge on the assets of the establishment and prevail over prior secured interests, while a pledge does not divest the employer of ownership in the pledged goods.

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