# In the matter of Nicco Corporation Limited IA (IB) No. 1058-KB-2020 in CP (IB) No.03-KB-2017

> NCLT judgment dated 2022-02-15. Citation: TCN-2022-NCLT-04129. The case involves an Interlocutory Application (IA (IB) No.1058/KB/2020) filed in a Corporate…

- **Court:** NCLT
- **Order date:** 15 Feb 2022
- **Citation:** TCN-2022-NCLT-04129
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/nicco-corporation-limited-ia-ib-no-1058-kb-2020-in-cp-ib-no03-kb-2017-3a62afff

## Summary

### Background

The case involves an Interlocutory Application (IA (IB) No.1058/KB/2020) filed in a Corporate Insolvency Resolution Process (CIRP) case (CP (IB) No.03/KB/2017) concerning Nicco Corporation Limited (in liquidation). The Nicco Employees Union (INTTUC) & others, representing 324 workmen, filed the application under section 60(5) of the Insolvency and Bankruptcy Code, 2016, seeking the calculation and disbursement of terminal benefits. A previous Company Application (IB) No.469/KB/2019, filed by the Applicants for securing terminal benefits, was disposed of earlier, directing the Liquidator to calculate the liability as per the waterfall mechanism under section 53 of the Code and section 25FFF of the Industrial Disputes Act, 1947. The applicants alleged that the

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## Facts

Nicco Corporation Limited is undergoing liquidation. The Nicco Employees Union (INTTUC) & others, representing 324 workmen, filed an application seeking the calculation and disbursement of terminal benefits. The Liquidator quantified the total terminal benefits of the 324 workmen at ₹6,89,75,549 but offered to pay only 17% of the same. The applicants contended that the Liquidator's computation was erroneous and did not include unpaid wages and salaries for the 24 months preceding the liquidation date (18 Oct 2015 to 17 Oct 2017), which amounted to ₹10,30,61,554. The Liquidator had previously been directed to calculate the liability as per the waterfall mechanism under section 53 of the Code and section 25FFF of the Industrial Disputes Act, 1947. The applicants also

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## Issues and analysis

### Issue 1: Whether the Liquidator correctly computed the terminal benefits payable to the workmen of Nicco …

**Ratio:** Section 53(1)(b) of the Code provides that the workmen's dues for the period of

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**Reasoning:** The court found that the Liquidator's computation was incomplete and inconsistent because

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**Interpretation:** The court interpreted section 53 of the Code and section 326 of the Companies

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**Application:** The court applied the ratio to the facts of the case and directed the

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## Parties

- **Judges:** Rajasekha…; Balraj…
- **Appellants:** Nicco Employees…
- **Respondents:** Nicco Corporation…; Vinod Kumar…

## Timeline

- **2017-01-01 — CP (IB) No.03…**: Corporate Insolvency Resolution Process (CIRP)…
- **2019-01-01 — Company Application…**: Filed by the Applicants for securing the terminal benefits of 324 member workmen of the…

## 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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