Provident fund dues take priority over secured creditors and workmen under the winding-up payment hierarchy.

Provident fund dues under Section 11(2) of the EPF Act constitute a first charge on the employer's assets and are payable in priority to all other debts, including secured claims. Section 529A of the Companies Act, 1956 gives overriding preferential treatment to workmen's dues and secured creditors within the statutory pari passu scheme, but it does not create a first charge for secured creditors or displace the specific priority granted to provident fund dues. Read together, the special statutes preserve the EPF Act's mandate, and the later amendment to the Companies Act does not dilute that priority. Accordingly, provident fund dues must be paid first in winding up.

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Issues: Whether the dues payable by an employer under Section 11(2) of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 have priority over the claims of secured creditors and workmen under Section 529A of the Companies Act, 1956 in the winding up of a company.

Analysis: Section 11(2) of the EPF Act declares the amount due from the employer in respect of provident fund contributions to be the first charge on the assets of the establishment and payable in priority to all other debts, including secured debts. Section 529A of the Companies Act, 1956 creates an overriding preferential payment in favour of workmen's dues and secured creditors to the extent of the pari passu charge contemplated by Section 529(1), but it does not create a first charge in favour of secured creditors or indicate an intent to displace the statutory first charge under the EPF Act. The two special enactments must be read according to their purpose and legislative policy, and the later amendment to the Companies Act does not dilute the specific mandate in favour of provident fund dues.

Conclusion: The priority under Section 11(2) of the EPF Act prevails over the competing claim under Section 529A of the Companies Act, 1956, and the provident fund dues are payable first.

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