SOCIETE GENERALE Vs. DAEWOO MOTORS INDIA LTD.

JUDGEMENT

(1.) Ca No.2006/2014

(2.) Counsel for the applicants, inter alia, relies on a decision of the Bombay High Court in Vishwanath Namdeo Patil v. Official Liquidator of Swadeshi Mills, 2014 1 CompLJ 130 (Bom). After examining the relevant facts and circumstances in that case, the Bombay High Court had issued certain directions to the Official Liquidator. Be that as it may, at least, to my mind, the nature of direction sought by the applicant in this case does not appear to have any sound legal basis. This is because notwithstanding the fact that the company has been ordered to be wound up on 28.07.2004, it still remains in existence with all its rights and obligations intact. The only significant difference for our purposes is that the same has been placed under administration in the hands of the liquidator. The Liquidator has merely stepped into the shoes of the erstwhile management and is now in control of the affairs of the company with the mandate to proceed with the liquidation of the company, inter alia, by determining all dues payable to and by the company; including any claims that may be made upon it by workmen for the payment of all such dues that the company was obliged to pay to them in law. It is in this context that the claim of the applicants towards release of their provident fund dues from the company has to be examined.

(3.) There is no gainsaying the fact that in terms of the extant law, all moneys due to workmen are to be paid by the Commissioner, Provident Fund, who happens to be a statutory Authority under the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 ("EPF Act"). In terms of the said statute, the company is under an obligation to forward certain payments towards provident fund as deducted from the workmen's dues from time to time, along with its own contributions, to the Commissioner, Provident Fund, to enable him to thereafter disburse the same whenever required. In this context, the Commissioner, Provident Fund, is also duty bound under the statute to raise appropriate demands on the company in case it becomes necessary to do so. Counsel for the applicants has not been able to demonstrate anything in law, or in fact, that circumvents this procedure; or, in any way, reorders the respective obligations of the company concerned or of the Commissioner, Provident Fund, merely because the company has gone under administration. The only change in circumstances that has come about is that the company has been placed under administration to ensure that its assets are not misapplied, or diluted to the detriment of the creditors and shareholders and that, all aspects are managed in an above board and transparent manner by the Liquidator, who steps into the shoes of the company management. There is however nothing to indicate that the respective obligations of the third parties, i.e., the workmen, the Commissioner, Provident Fund, and the company, to each other are, in any way, altered. It is therefore obvious that at least in this context, the company; or in this case, the Official Liquidator currently administering its affairs; cannot be compelled to do something which it was not obliged to do in the normal course before the company went into administration. In other words, there can be no ground in law to place an additional compulsion on the Official Liquidator to either process or pursue the claims of the workmen with the Commissioner, Provident Fund, which even the company was not obliged to do. To my mind, under the relevant provisions of the Act, the concerned workmen remain under an obligation to apply to the Commissioner, Provident Fund, who is thereafter obliged to calculate their dues and to pay the same; if necessary, after raising an appropriate demand from the company by filing the necessary claim before the Liquidator in this behalf. Once that is done, the Liquidator would be obliged to examine the claim and to admit it as per law whilst granting it the appropriate priority.