Topic
An EPF assessment order issued during the CIRP was set aside because the IBC moratorium prevents continuation of such inquiries and the amendment to Section 31(6) extinguishes claims filed before resolution. The ruling limits employees’ provident-fund claims against insolvent companies and guides resolution professionals.
The Punjab & Haryana High Court ruled that default in EPF contributions under Section 14 of the EPF Act automatically triggers criminal liability, even if recovery proceedings are stayed. The stay only halts civil enforcement, not criminal prosecution, exposing employers to legal action regardless of financial disputes or interim relief.
NCLAT rules that EPFO cannot file claims during Corporate Insolvency Resolution Process (CIRP) based on enforcement reports prepared after the moratorium under Section 14 of the Insolvency and Bankruptcy Code (IBC) commences. The decision reinforces that statutory creditors like EPFO must initiate assessment proceedings before CIRP begins to be admissible.