# In the matter of Marmagoa Steel Limited

> NCLT judgment dated 2024-02-09. Citation: TCN-2024-NCLT-02679. The Regional Provident Fund Commissioner, Goa, filed an application (I.A. 667 of 2023) in the…

- **Court:** NCLT
- **Order date:** 9 Feb 2024
- **Citation:** TCN-2024-NCLT-02679
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/marmagoa-steel-limited-6f85c9c9

## Summary

### Background

The Regional Provident Fund Commissioner, Goa, filed an application (I.A. 667 of 2023) in the Corporate Insolvency Resolution Process (CIRP) of Marmagoa Steel Ltd., seeking intervention in the company petition and allowance of its claim of Rs. 1,47,90,485 along with interest. The applicant also sought to restrain Pridhvi Asset Reconstruction and Securitization Company Ltd. from taking over the assets of the company under liquidation and requested that their claim be considered a priority as per IBC and EPF & MP Act, 1952. The liquidator was directed to determine the amount of contribution to the Provident Fund and treat it outside the liquidation estate.

## Facts

The Regional Provident Fund Commissioner, Goa, filed an application (I.A. 667 of 2023) in the Corporate Insolvency Resolution Process (CIRP) of Marmagoa Steel Ltd. The applicant sought to intervene in the company petition and have its claim of Rs. 1,47,90,485, along with interest, allowed. The applicant also sought to restrain Pridhvi Asset Reconstruction and Securitization Company Ltd. from taking over the assets of the company under liquidation. The applicant claimed priority under IBC and EPF & MP Act, 1952. The applicant passed orders under Section 7A and 14B/7Q of the EPF & MP Act in 2015 and 2021. Liquidation of Marmagoa Steel Ltd. commenced on 10.2.2021. The liquidator acknowledged the EPFO claim and requested documents. The liquidator objected to the

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## Issues and analysis

### Issue 1: Whether the Applicant should be allowed …

**Ratio:** PF contributions of the employer and employee do not form part of the liquidation estate

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**Reasoning:** The court stated that PF contributions are payable to the employees and do not form part

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**Interpretation:** This means that the provident fund dues have a higher priority than other debts

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**Application:** The liquidator is directed to determine the amount of contribution to the

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## Parties

- **Judges:** Prabhat…; V.G. B…
- **Appellants:** Regional Provident…
- **Respondents:** Marmagoa Steel…; Pridhvi Asset…

## Timeline

- **2017-03-20 — CIRP Commen…**: Corporate Insolvency Resolution Process…
- **2018-07-02 — Resolution Plan…**: Tribunal approved the resolution plan submitted by Chander Engineering and Trading…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 60(5) — Adjudicating Authority for corporate persons](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-60)

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