Resolution plan clarificatory note governed provident fund, gratuity and additional employee dues; separate salary claim was rejected.

Where a clarificatory note is expressly made part of an approved resolution plan and given overriding effect, its broad wording governs additional statutory dues payable to workmen and employees, including provident fund and gratuity. The note covered liabilities payable by operation of law or for any other reason, whether admitted or unadmitted, crystallised or uncrystallised, and these dues were treated as payable under the plan rather than outside it. The separate claim for unpaid salary from July to November 2020 was not accepted, as the record showed CIRP costs had already been accounted for on the basis determined by the resolution professional and no further payment was justified.

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Issues: (i) Whether provident fund and gratuity dues of workmen and employees were required to be paid under the resolution plan read with the clarificatory note, or were to be borne independently by the successful resolution applicant. (ii) Whether the claim for unpaid salary for the period July to November 2020 was liable to be included in the CIRP cost or otherwise granted.

Issue (i): Whether provident fund and gratuity dues of workmen and employees were required to be paid under the resolution plan read with the clarificatory note, or were to be borne independently by the successful resolution applicant.

Analysis: The resolution plan itself dealt only with workmen liquidation dues and employees' dues and did not expressly include provident fund or gratuity. However, the clarificatory note, which was made an integral part of the plan and was given overriding effect, contained a broad stipulation that any additional amount payable to workmen or employees by operation of law, by order of court or tribunal, or for any other reason, whether admitted or not, crystallised or uncrystallised, known or unknown, present or future, would be paid out of the total financial outlay in the stated order of priority. This language was held wide enough to cover provident fund and gratuity dues. The distinction drawn from the earlier Jet Airways decision was accepted, because the present plan and clarificatory note expressly addressed such additional liabilities.

Conclusion: Provident fund and gratuity dues were held payable under the resolution plan read with the clarificatory note, and not as a liability outside the plan.

Issue (ii): Whether the claim for unpaid salary for the period July to November 2020 was liable to be included in the CIRP cost or otherwise granted.

Analysis: The record showed that the resolution professional had already included salary and wage components to the extent recognised in the CIRP cost, and the computation of CIRP expenses was within the professional's domain. The asserted claim for salary from July to November 2020 was not accepted on the facts, and no basis was found to direct any additional payment beyond what had already been accounted for in the CIRP cost.

Conclusion: The claim for salary for July to November 2020 was rejected.

Final Conclusion: The approval of the resolution plan was sustained, while the dues towards provident fund and gratuity were directed to be paid in accordance with the plan and clarificatory note. No further relief was granted on the salary claim.

Ratio Decidendi: Where a clarificatory note is expressly made part of an approved resolution plan and confers overriding effect, its clear and wide wording governs additional statutory dues payable to workmen and employees, including provident fund and gratuity.

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