Provident fund transfer liability: Section 17B does not cover involuntary statutory sale by a financial corporation.

Section 17B of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 applies only where an establishment is transferred by the employer, attracting joint and several liability on the transferor and transferee. A takeover and sale by a State Financial Corporation under the State Financial Corporations Act, 1951 is an involuntary transfer by operation of law, not a voluntary transfer inter vivos by the employer. On that basis, the transferee could not be saddled with the transferor's pre-existing provident fund dues or denied a fresh code number on that footing.

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Issues: Whether Section 17B of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 applied to an establishment transferred by the State Financial Corporation so as to fasten past provident fund liabilities on the transferee, and whether the petitioner was entitled to a fresh code number instead of being continued under the transferor's code.

Analysis: Section 17B fastens joint and several liability on the employer and transferee where the establishment is transferred by the employer, but the transfer in the present case was not an act of the employer. The unit had been taken over by the State Financial Corporation on default under Section 29 of the State Financial Corporations Act, 1951 and thereafter transferred to the petitioner. Such a transfer was by operation of law and not a voluntary transfer inter vivos by the employer. The statutory scheme of the provident fund law, including the definitions of employer and occupier and the recovery provisions, did not justify applying Section 17B to this kind of transfer.

Conclusion: Section 17B was inapplicable to the petitioner's acquisition, and the provident fund authorities could not fasten the transferor's unpaid liabilities on the petitioner or refuse a fresh code number on that basis.

Final Conclusion: The impugned communication was unsustainable and was quashed, leaving the petitioner free from the transferor's pre-existing provident fund dues for the purpose of code allotment.

Ratio Decidendi: Section 17B of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 applies only to transfers of an establishment by the employer and not to involuntary transfers effected through statutory seizure and sale by a financial corporation.

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