Pranav B Prem

The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, comprising Justice Ashok Bhushan (Chairperson) and Barun Mitra (Member-Technical), has held that Provident Fund dues arising out of an assessment made after the liquidation commencement date under Section 7A of the Employees’ Provident Funds (EPF) Act, 1952, are not admissible in liquidation proceedings under the Insolvency and Bankruptcy Code (IBC).

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The corporate debtor, Gujarat Foils Ltd., entered CIRP on 30 November 2017, and an order for liquidation was passed on 16 September 2019. More than two years later, on 11 October 2021, the Regional Provident Fund Commissioner conducted a Section 7A inquiry and determined PF dues of ₹1.68 crore. Based on this assessment, the EPFO filed a claim for ₹4.57 crore (including damages under Section 14B and interest under Section 7Q) before the liquidator. The liquidator rejected the claim, holding that (i) the assessment was made during moratorium, and (ii) only claims that exist on the liquidation commencement date can be admitted. The EPFO challenged this rejection before the NCLT, which dismissed the application, prompting the present appeal.

EPFO’s Stand

The EPFO argued that the dues determined on 11 October 2021 actually related to the pre-CIRP period, and therefore had to be treated as statutory dues protected under Section 36(4)(a)(iii) of the IBC, which excludes PF, pension and gratuity dues from the liquidation estate. It contended that the liquidator was obligated to admit and pay the amount, relying on Supreme Court judgments affirming the priority of PF dues.

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Liquidator and Successful Bidder's Stand

The Respondents submitted that the Section 7A assessment was made two years after liquidation began, and therefore no such claim existed on the liquidation commencement date, as required under Regulation 16(2) of the IBBI (Liquidation Process) Regulations, 2016. They highlighted that (i) the corporate debtor had been sold as a going concern, (ii) liquidation was nearing closure, and (iii) EPFO had filed the claim two years past the last date for claims (23 October 2019) and even failed to file an appeal under Section 42 of the IBC against rejection of its claim. Reliance was placed on Employees’ Provident Fund Organisation, Nashik v. Girish Siriram Juneja (2025), where the NCLAT had already held that claims arising from post-liquidation orders under Sections 7A, 7Q and 14B are barred.

Findings of the NCLAT

The Appellate Tribunal held that, under Regulation 16(2), only those claims that are in existence as on the liquidation commencement date can be admitted. Since the Section 7A order was passed on 11 October 2021, long after liquidation commenced (16 September 2019), the claim was never in existence at the relevant date and was therefore inadmissible. The NCLAT reiterated that post-liquidation assessments under Sections 7A, 7Q or 14B cannot form the basis of claims in liquidation, following its earlier ruling in EPFO, Nashik v. Girish Siriram Juneja. The Tribunal distinguished the Supreme Court’s judgment in Esskay Pharmaceuticals, noting that the question there concerned the priority of PF dues in company winding-up—not the admissibility of post-liquidation assessments.

The Tribunal further noted that the EPFO had other legal remedies for recovery of dues determined after liquidation commencement. However, the liquidator was not bound to admit such claims in liquidation.

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The NCLAT upheld the NCLT’s order and dismissed the EPFO’s appeal, clarifying that:

• PF dues assessed after liquidation commencement are not admissible claims under the IBC.

• Non-admission in liquidation does not prevent EPFO from pursuing other remedies under the EPF Act for recovery.

Appearance

For Appellant: Mr. Braja Bandhu Pradhan, Mr. Himanshu Rai and Mr. Kishan Kumar Behuria, Advocates.

For Respondents: Mr. Divyanshu Rai, Ms. Taruna and Mr. Shubh Gautam, Advocates for R-1.

Cause Title: The Regional P.F. Commissioner, Employees' Provident Fund Organization v. Alok Kailash Saksena Liquidator of Gujarat Foils

Case No: Company Appeal (AT) (Insolvency) No. 807 of 2025

Coram: Justice Ashok Bhushan (Chairperson), Barun Mitra (Member-Technical)