Tag: Employees Provident Fund

SARFAESI Act vs EPF Act: Supreme Court Says Provident Fund Charge Prevails Over Bank
9Feb By The Legal ChamberNo Comments
Supreme Court

SARFAESI Act vs EPF Act: Supreme Court Says Provident Fund Charge Prevails Over Bank

This Supreme Court judgment interprets the interplay between the priority of secured creditors under Section 26E of the SARFAESI Act and the statutory first charge for provident fund dues under Section 11(2) of the EPF & MP Act. The Supreme Court held that the statutory first charge for provident fund contributions overrides the priority granted to secured creditors, even under a non-obstante clause in a later enactment. Facts Of The Case: The appellant, Jalgaon District Central Co-operative Bank Ltd., is a secured creditor which had advanced loans to a co-operative sugar society, secured by a mortgage and hypothecation of the society's assets. The sugar factory became defunct, leading to loan defaults. The bank initiated recovery under the SARFAESI Act, took possession o...
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Supreme Court Directs Independent Officer to Verify Arrears, Stop Illegal Recoveries from Workers
28Dec By The Legal ChamberNo Comments
Supreme Court

Supreme Court Directs Independent Officer to Verify Arrears, Stop Illegal Recoveries from Workers

This Supreme Court judgment addresses contempt proceedings for non-compliance with a prior Supreme Court order modifying an industrial tribunal award. The Court appoints an auditor to resolve wage calculation discrepancies, assess excess payment recoveries, and determine statutory gratuity interest. It refrains from intervening in a separate High Court matter concerning provident fund dues, affirming the High Court's competence on that issue. Facts Of The Case: The contempt petition arose from the Brihanmumbai Municipal Corporation's (BMC) non-compliance with a Supreme Court judgment dated April 7, 2017. That judgment had modified an Industrial Tribunal award, which originally directed the BMC to grant permanent status and retrospective benefits to approximately 2,700 sanitation workers ...
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Who Gets Paid First? Supreme Court Reopens Case on Priority Between Employee Provident Fund and Secured Lenders
30Sep By The Legal ChamberNo Comments
Supreme Court

Who Gets Paid First? Supreme Court Reopens Case on Priority Between Employee Provident Fund and Secured Lenders

The Supreme Court remanded the matter to the High Court to determine the priority of charges between the EPFO, under Section 11(2) of the Employees' Provident Fund Act, 1952, and secured creditors, including Axis Bank, under Section 35 of the SARFAESI Act, 2002. The core legal issue for fresh adjudication is the conflict between the statutory first charge of EPFO dues and the primacy claimed by secured creditors. Facts Of The Case: M/s Acropetal Technologies Pvt. Ltd. defaulted on its Employees' Provident Fund (EPF) dues from July 2013. The EPFO determined a liability and, upon learning the company's properties were to be auctioned by various banks, invoked its priority under the EPF Act. The EPFO specifically asserted a first charge over the 'Attibele property' being auctioned by Axis B...
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Landmark Ruling: Supreme Court Says Two Companies Are One for EPF Compliance
11Aug By The Legal ChamberNo Comments
Supreme Court

Landmark Ruling: Supreme Court Says Two Companies Are One for EPF Compliance

The Supreme Court upheld the clubbing of two pharmaceutical companies under the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952, emphasizing the principles of unity of ownership, management, functional integrality, and financial unity. The Court rejected the argument that separate juristic entities preclude clubbing, affirming that the EPF Act, as a beneficial legislation, must be interpreted to prevent evasion. The decision reiterated that multiple factors, including common premises, shared infrastructure, and unified management, cumulatively determine whether entities constitute a single establishment. The judgment reinforced the authorities' discretion to assess dues retrospectively once clubbing is established. Facts Of The Case: The case involved M/s Torino Laborat...
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