Moratorium bars post-CIRP provident fund assessment proceedings and consequential claims against the corporate debtor.

Once moratorium under the Insolvency and Bankruptcy Code begins, no fresh assessment under Sections 7Q and 14B of the EPF Act can be initiated or continued against the corporate debtor to fasten pecuniary liability. The fact that the liability related to a pre-insolvency period did not permit post-moratorium assessment proceedings. The resulting claim based on such assessment was therefore not admissible in the insolvency process, and the rejection of the application was upheld in law.

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Issues: Whether, after admission of the corporate debtor into corporate insolvency resolution process and the commencement of moratorium, the provident fund authority can initiate or continue assessment proceedings for interest and damages under Section 7Q and Section 14B of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952, and then seek admission of the resulting claim in the insolvency process.

Analysis: The assessment proceedings under Section 7Q and Section 14B were initiated after the commencement of the corporate insolvency resolution process and after moratorium under Section 14 of the Insolvency and Bankruptcy Code, 2016 had come into force. The Court applied the settled principle that once moratorium begins, no fresh assessment can be initiated or continued against the corporate debtor so as to fasten pecuniary liability. The fact that the underlying period related to a time before insolvency did not permit post-moratorium assessment proceedings. The judgments relied upon by the appellant were distinguished as they did not decide the specific issue of assessment after commencement of insolvency proceedings.

Conclusion: The post-CIRP assessment and consequential claim were impermissible, and the rejection of the appellant's application was in law.

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