EMPLOYEES PROVIDENT FUND ORGANIZATION, MINISTRY OF LABOUR, GOVERNMENT OF INDIA Vs. OFFICIAL LIQUIDATOR, RAJASTHAN HIGH COURT, JAIPUR, "CORPORATE BHAWAN", G

JUDGEMENT

(1.) Both these appeals raise identical questions of law and facts, therefore, are being decided together. Special Appeal (Civil) No. 29/2016 has been filed by the Employees Provident Fund Organization, Regional Office, Jaipur, (for short, 'the EPFO') praying for modification in the order of the Company Court dated 12.02.2016 by deleting the direction given therein, for not disbursing the amount of provident fund to the employees until they vacate the land of the liquidated company, the disbursement of which was directed by order of this court dated 05.01.1996 in Company Application No. 1/1996 and further, for setting aside the order dated 26.08.2016. Special Appeal (Civil) No. 2/2017 has been filed by Soot Mill Colony Kachchi Basti Vikas Samiti challenging the order dated 27.01.2017, by which its application for recall of order dated 12.02.2016, as mentioned above, has been dismissed with costs of Rs. 20,000/-, to be paid to the Rajasthan State Legal Services Authority, Jaipur, within 75 days from the date of order. Further prayer is made for a direction to the respondents to regularize the quarters and small huts where the members of the applicant are residing against the dues of the employees.

(2.) Mr. Deepak Goyal, learned counsel for the EPFO, submitted that this court in Company Petition No. 10/1980 passed winding up order of M/s. Jaipur Spinning and Weaving Mills Limited, Jaipur, on 03.12.1982. The appellant EPFO filed a Company Application No. 27/1996 before the Company Court with an averment that it had submitted claim in the office of the Official Liquidator in respect of dues of provident fund payable to the employees of the liquidated company. The Official Liquidator, vide letter dated 27.02.1992 informed the appellant that the claim of the appellant against the company has been allowed to the tune of Rs. 14,35,839/- as a preferential claim under section 530(f) of the Companies Act, 1956, and that further claim of Rs. 5,93,866/- was allowed as ordinary claim. This court in S.B. Company Application No. 1/1996 passed a suo motu order under section 529A of the Companies Act, 1956 on 05.01.1996, thereby directing full payment of the claim settled by the Official Liquidator to the employees of the company towards arrears of their salary. Apart from sections 529A and 530 of the Companies Act, 1956 (for short, 'the Act of 1956'), section 11 of the Employees Provident Funds and Miscellaneous Provisions Act, 1952 (for short, 'the Act of 1952') also provides for the priority of the payment of contribution over other debts. The Official Liquidator, while issuing a letter dated 27.02.1992, failed to consider the effect of Section 11 of the Act of 1952 because the entire claim of the provident fund was required to be treated as a preferential claim. This court decided the aforesaid application on 06.09.1996 with the direction that the provident fund has specifically been included under Section 530 of the Act of 1956 and therefore the claim of appellant would, to the extent of Rs. 14,35,839/-, be treated as preferential and be considered as such while making payment to other preferential creditors.

(3.) It is contended that the appellant-EPFO has been regularly requesting the Official Liquidator since 1997 to make payment of the preferential claim of Rs. 14,35,839/- but the Official Liquidator has not released the amount due to a lack of funds and always assured that whenever funds would become available, the payment would be made on a priority basis. Finally the Official Liquidator, during the pendency of the aforesaid application, made payment on 11.02.2016. The Application No. 10/2016 was disposed off by the impugned order of the Company Court dated 12.02.2016 as infructuous but with the direction "that from amongst the amounts remitted by the Official Liquidator under his letter dated 11.02.2016, no disbursement be made to the workers entitled thereto unless they have vacated the land of the company in liquidation as per directions of this Court on 05.01.1996 in Company Application No. 1/1996."