TaxTMI 
TaxTMI 
TaxTMI 
2017 (4) TMI 630
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....9,334/- towards the payment of Employees Provident Fund Office of Thane, Kandivali, Bandra and Vadodara against their claims i.e. from Punjab and Maharashtra Co-operative Bank Ltd. at the rate of 93.02% for Rs. 21,77,12,691/- and from UCO Bank at the rate of 6.98% for Rs. 1,63,36,643/- and seeks direction against the Employees Provident Fund Office Kandivali to deposit an amount of Rs. 1,12,93,011/- being excess amount alleged to have been paid by the learned Official Liquidator against their admitted amount of Rs. 5,54,64,810/-. The Official Liquidator also seeks permission to pay dividend at the rate of 2.504 paise in a rupee, amounting to Rs. 28,29,640/- on movable assets and at the rate of 41.024 paise in rupee amount to Rs. 4,63,59,090/- on immovable properties i.e. totalling to Rs. 4,91,88,730/- to 385 workers. 2. The Official Liquidator seeks further permission to declare further dividend to 3348 works and Punjab and Maharashtra Co-operative Bank Ltd. for sum of Rs. 33,89,11,654/- on immovable properties at the rate of 10.882 paise in a rupee whose claims were admitted as per the certified list and 1st to 6th Supplementary List filed with the Prothonotary and Senior Master ....
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.... Rs. 8,07,34,351/-. 7. The claims of EPFO of Thane, Vadodara and Kandivali were re-adjudicated and the claim of Bandra EPFO were adjudicated through the Chartered Accountant. The total amount adjudicated in respect of EPFO Unit Thane, Vadodara and Bandra came to Rs. 24,80,25,844/-. The Official Liquidator has already made payment of Rs. 1,39,76,530/-. The balance amount payable to those three offices of Employees Provident Fund came to Rs. 23,40,49,334/- according to the claim adjudicated by the chartered accountant. Insofar as EPFO Kandivali is concerned, the claims admitted was at Rs. 5,54,64,810/- whereas the amount released by the Official Liquidator is Rs. 6,67,57,821/- thereby making an excess payment of Rs. 1,12,93,011/-. 8. The Official Liquidator by his report seeks permission to make the provision of Rs. 23,40,49,334/- towards the payment of EPFOs Thane, Kandivali, Bandra and Vadodara. The Official Liquidator further seeks direction that the EPFO Unit Kandivali be directed to deposit amount of Rs. 1,12,93,011/- being excess amount paid by the office against their admitted amount of Rs. 5,54,64,810/- and as against that payment made to the said EPFO Kandivali is at Rs. 6....
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.... Bandra is entitled to the claim of Rs. 3,08,58,392/-. 13. Mr.Suresh Kumar, learned counsel for the Regional Provident Fund Commissioner submits that the claim of Rs. 30,26,37,317/- filed by the Provident Fund Commissioner with the official liquidator on 19th June 2013 includes the claim towards the Provident Fund dues of the company for the period from September 2000 to December 2005 and also includes the employees' share of Rs. 14,18,05,857/- and employer's share of Rs. 14,18,05,857/-. 14. Learned counsel placed reliance on Section 6 of the Employees' Provident Funds & Miscellaneous Provisions Act, 1952 (for short "the said EPF Act") and also on the paragraph 30 of the Employees' Provident Funds Scheme, 1952. He submits that the claim for Rs. 14,18,05,857/- towards employees' share is maintainable which is not considered by the official liquidator in its report. He submits that the claim for Rs. 14,18,05,857/- is also maintainable towards the employer's share. Pursuant to the direction issued by this Court on 13th October 2016, learned counsel filed statement of Employees wages with Employees Provident Fund contribution containing Employee share and Empl....
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....ted. He submits that the claim of the Provident Fund had priority over the secured creditors and thus the claim of the Provident Fund Commissioner has to be given priority over the secured creditors. 18. Learned counsel for the Punjab and Maharashtra Cooperative Bank Ltd., one of the secured creditors submits that her client stands outside winding up proceedings and had conducted the sale of the immovable properties and other movable assets and has received consideration of Rs. 180 crore for the sale of the immovable securities. The said bank has sold movable securities and has received Rs. 13,51,00,000/-. She submits that the official liquidator has admitted the claim of the bank in the sum of Rs. 1,16,91,34,883/-. She submits that her client has already deposited a sum of Rs. 1,36,58,98,280/- with the official liquidator and UCO Bank and has also deposited the amount with the official liquidator. The PMC bank has also deposited a sum of Rs. 99,93,23,213/- in FDR. It is submitted that the bank has no objection if prayer clause (a) of the report is allowed. 19. Mr.Naidu, learned counsel appearing for 2963 workers opposes the submissions made by Mr.Suresh Kumar, learned counsel fo....
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....ative Bank Ltd. has never objected to the adjudication process of the official liquidator nor has challenged the decision of the official liquidator admitting the claim of the said bank in the sum of Rs. 1,16,81,34,883/- within 21 days from the date of such adjudication by the official liquidator. He submits that 1st and 2nd dividend have already been paid to the said bank. 22. In so far as the submission of the learned counsel for the the Regional Provident Fund Commissioner, Kandivali is concerned, learned counsel submits that the claim of the Kandivali office is admissible only for a sum of Rs. 5,54,64,810/- for the period from January 2000 till the date of winding up i.e. 16th December 2005. However, the claim of the said Kandivali office has been allowed in the sum of Rs. 6,67,57,821/-. He submits that the official liquidator is thus entitled to recover the excess amount of Rs. 1,12,93,011/- from the Kandivali office of the Regional Provident Fund Commissioner. The official liquidator submits that the interest is calculated by the official liquidator upto the date of winding up and no further interest is payable. He submits that the claim of the Kandivali office was adjudicat....
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....the said EPF Act and interest beyond the date of winding up though there was no surplus. This Court after adverting to the judgment of the Supreme Court in the case of Employees Provident Fund Commissioner Vs. Official Liquidator of Esskay Pharmaceuticals Ltd., reported in (2011) 2 Comp.L.J. 465 (SC) has held that by virtue of Section 11(2) of the said EPF Act, the provident fund dues have priority over all other dues including the dues of secured creditors. It is further held that such priority needs to be accorded not only to the provident fund dues computed under Section 7C, but also to interest due under Section 7Q and damages adjudicated under Section 14B. 27. This Court in the said judgment has held that since the salaries payable to the employees for the relevant period have been paid in full i.e. without deducting any employees' contribution to the fund, there is no question of paying the Regional Provident Fund Commissioner the component of employees' contribution on behalf of the employees. These amounts have been directed to be received by the employees in winding up and are not claimable separately by the Regional Provident Fund Commissioner. This Court has als....
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....wer to adjudicate upon the claim for damages which were to be adjudicated upon exclusively by the authority under the provisions of Section 14B of the said EPF Act. In my view, the judgment of this Court in the case of Regional Provident Fund Commissioner, Thane (supra) squarely applies to the facts of this case. I am respectfully bound by the said judgment. In my view, the claim for damages made by the Provident Fund Authorities before the official liquidator is thoroughly misconceived and is rightly rejected by the official liquidator. I do not find any infirmity with the order of rejection of this claim by the official liquidator. 30. In so far as apprehension of the learned counsel for the Regional Provident Fund Commissioner that the workers may adopt the appropriate proceedings i.e. civil or criminal against the Authorities for non-payment of contribution of the employees by the Authorities is concerned, Mr. Naidu, learned counsel for 2963 employees and Mr.Anil Kumar, learned counsel for 1616 employees state that the employees have already made a statement before this Court that their respective clients will not make any claim or take any action against the Provident Fund Au....
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....uidator. The judgment of this Court in the case of Regional Provident Fund Commissioner, Thane (supra) squarely applies to the facts of this case. I am respectfully bound by the said judgment. 34. Division bench of this Court in the case of Pravin S. Shah Vs. Rashtriya Mill Mazdoor Sangh, Bombay Vs. Official Liquidator, High Court, Bombay, reported in 2009 (2) Mh.L.J. 897 after construing Rule 179 of the Companies (Court) Rules, 1959 has held that it is only if the company is left with surplus funds after distribution of the dues of the secured creditors and the workers dues both pari passu as per the provisions of sections 529 and 529A of the Act and after distribution of preferential dues under section 530 of the Act, that the question of awarding any interest on the dues of the secured creditors or the workmen's dues for the further period after the relevant date will arise. In my view, the claim for interest for the period subsequent to the date of winding up by the Punjab and Maharashtra Co-operative Bank Ltd. is rightly rejected by the official liquidator. The said claim for interest for the subsequent period made by the Punjab and Maharashtra Co-operative Bank Ltd. is c....
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....ts. The official liquidator is not expected to make contribution in the funds after he takes charge. The judgment of this Court in the case of Engineering Workers Association (supra) squarely applies to the facts of this case. I am respectfully bound by the said judgment. 37. In my view, the claim thus made by the Regional Provident Fund Commissioner for employer's contribution as well as towards employees' contribution from the official liquidator is totally untenable and is rightly rejected by the official liquidator. In my view, there is thus no substance in this demand of the Regional Provident Fund Commissioner against the official liquidator and is accordingly rejected. 38. In so far as prayer clauses (c) to (j) are concerned, the learned counsel appearing for the Official Liquidator states that a fresh report in respect of those prayers would be filed before this Court within three weeks from today. In view of the statement made by the learned counsel for the Official Liquidator, those prayers need not be considered by this Court at this stage. 39. In so far as deduction sought by the Official Liquidator against the employees provident fund Kandivali to deposit a ....
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..... My attention is invited to paragraph 8 of the affidavit filed by the Regional Provident Fund Commissioner, Kandivali admitting that as on 19th January 2017, the Provident Fund Office has settled the Provident Fund claim alongwith pension/death claim in respect of 298 employees for an amount of Rs. 4,82,24,677/- and had disbursed the said amount to the respective employees. They also invited my attention to page 27 of the said affidavit filed by the Regional Provident Fund Commissioner, Kandivali thereby annexing the list of the employees (members) and the amount sanctioned and disbursed to 298 employees in the sum of Rs. 4,82,24,677/-. Learned counsel invited my attention to Annexture 1 to the affidavit dated 23rd February, 2017 filed by the Regional Provident Fund Commissioner, Kandivali and would submit that the claims made by the Kandivali Office is made in respect of 350 employees for distribution of Provident Fund dues along with allied dues to the employees. It is submitted that in the said Ann.1, the Regional Provident Fund Commissioner, Kandivali has claimed various amounts towards employees shares as well as employers share of provident fund which claims are rightly reje....