Gujarat High Court
Empire Hotel And Resorts Limited vs Gujarat Industrial Investment ... on 14 February, 2014
Author: Jayant Patel
Bench: Jayant Patel
C/MCA/2076/2013 ORDER
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
MISC.CIVIL APPLICATION (FOR DIRECTION) NO. 2076 of 2013
In SPECIAL CIVIL APPLICATION NO. 11524 of 2002
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EMPIRE HOTEL AND RESORTS LIMITED....Applicant(s)
Versus
GUJARAT INDUSTRIAL INVESTMENT CORPORATION LTD. &
34....Opponent(s)
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Appearance:
MR AS VAKIL, ADVOCATE for the Applicant(s) No. 1
MR HARDIK SONI, AGP for the Opponent(s) No. 2 3
MR DHARMESH V SHAH, ADVOCATE for the Opponent(s) No. 7
MR NIRAL R MEHTA, ADVOCATE for the Opponent(s) No. 8
MR RD DAVE, ADVOCATE for the Opponent(s) No. 1
NOTICE SERVED for the Opponent(s) No. 1 3 , 5 , 7
NOTICE UNSERVED for the Opponent(s) No. 4 , 6
SERVED BY RPAD (N) for the Opponent(s) No. 5
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CORAM: HONOURABLE MR.JUSTICE JAYANT PATEL
Date : 14/02/2014
ORAL ORDER
1. The present application has been preferred by the applicant for seeking direction to make payment of Rs.3,16,115/ and Rs.11,60,477/ to the Assistant Provident Fund Commissioner on account of the order passed by the Assistant Provident Fund Commissioner against the company.
2. I have heard Mr.Apoorva Vakil, learned counsel appearing for the applicant, Mr Dave for respondent no.1, Mr.Soni, learned AGP for respondents no.2 and 3, Mr.Bhatt for respondents no.9 to 35 and Mr.Mehta for respondent no.8.
3. As such, when this Court earlier passed the order Page 1 of 6 C/MCA/2076/2013 ORDER on 15.01.2009 for disbursement of the amount of Rs.809.82 lakhs, it was observed at para 23(iii) as under:
"The claim of the workers/employees, if any, can be considered on pari passu basis with the secured creditors. However, as the quantification is not finalized by any appropriate forum, nor are the details thereof placed on record, the disbursement of the amount to the workers/employees shall await till the final adjudication by the concerned forum, if any. Hence, the order for disbursement to the workers/employees is not passed at this stage, but upon the quantification of the amount by appropriate authority, the proportionate amount on pari passu basis with the secured creditor shall remain set apart towards workers' dues."
It may also be recorded that when direction was given, this Court, at para 22, for the application of the Provident Fund Commissioner, being Civil Application No.9733/07, had observed thus "The applicant of Civil Application No.1733 of 2007 is the Assistant Provident Fund Commissioner, who is desirous to be impleaded as party respondent in the main Special Civil Application No.11524 of 2002. As per the said application, the applicant has to recover the amount of Rs.16,78,638/ towards P.F. Dues. As observed earlier, P.F. Dues would stand included in the workers' dues to be considered on pari passu basis. Therefore, if the workers have claimed the amount, excluding the P.F. Contribution by the employees, the claim of Provident Fund Authority may be required to be considered. However, if the workers have excluded the P.F. Contribution, which remained unpaid in Page 2 of 6 C/MCA/2076/2013 ORDER the workers' dues, separate enforcement of the P.F. Contribution may not be required. No details are available on record on the said aspects and the application is only to be impleaded as party respondent. The learned Counsel for the applicant has also made submission for being impleaded as party respondent. Therefore, if the applicant is permitted to be impleaded as party respondent, no prejudice will be caused."
5. The aforesaid shows that at the relevant point of time, there was no prayer by PF Authority for seeking recovery of the amount of Rs.16,78,638/ and the only prayer was to be impleaded as party. Apart from the above, thereafter, if as per PF authority, the amount is quantified, it is for the PF authority to move this Court for seeking disbursement of the amount. If the applicant is to seek direction for payment, the same would require the claim of the workers, which uptil now is not finalised.
6. It is true that the amount after disbursement of Rs.809.82 lakhs has remained as balance and as per the subsequent order dated 13.09.2013, passed by this Court in MCA No.2727/12, when the claim was to be settled of the outstanding dues of Charotar Nagrik Sahakari Bank Ltd., this Court, at para 16 in the said order had recorded that the balance amount available as on 19.12.2012 was of Rs.10,19,45,773/ and out of the said amount, considering the ratio, this Court for the reasons recorded in the order, permitted disbursement, but in the said matter, the Page 3 of 6 C/MCA/2076/2013 ORDER applicant had to file undertaking that if the ratio is altered to the prejudice of the other creditors, the Director of the company shall make good the difference subject to his right to challenge the decree before the higher forum.
7. When it is put to Mr. Vakil, learned counsel appearing for the applicant as to whether the applicant is ready to file an undertaking on the same line so as to make good the difference, if any, after the claim of the workers' dues is finalised or not, he has shown disinclination and has submitted that the applicant Company is not ready to file the undertaking.
8. In my view, after the earlier order dated 15.01.2009 was passed by this Court in SCA No.11524/02 and allied matters and the disbursement of Rs.809.82 lacs having been made, the question of further disbursement would arise only if there is proper adjudication of the amount towards workers' dues.
9. It has been stated by Mr.Bhatt appearing for the workers who are joined as respondents no.9 to 35 that they have moved the competent authority but the issue is still pending before the competent authority.
10.Be as it may, if the workers dues are to be considered with the PF dues, the ratio on the principles of pari passu charge with the secured Page 4 of 6 C/MCA/2076/2013 ORDER creditor may be required to be finalised in the same manner. If irrespective of the workers' dues, the outstanding dues of PF authority are considered, such may fall in the Government dues which may be later in the category. If it is satisfactorily demonstrated that the charge was already effected prior to the auction sale, the question of priority may also be required to be examined. The principles of first charge of PF dues even if considered for the sake of examination, may apply in a case where the company is already ordered to be wound up which is not the fact situation in the present case. Further, out of the total dues of PF authority, Rs.3,16,115/ is towards PF contribution whereas Rs.4,77,138/ and Rs.6,83,339/ total Rs.11,60,477/ are towards penalty imposed by the PF authority.
11.I may also record that the PF authority has not moved this Court seeking disbursement. But the applicant has moved this Court for payment to be made to the PF authority. In my view, unless the question of workers' dues is finalised, the issue cannot be considered more particularly when the applicant is not ready to file undertaking to make good any shortage of the amount towards workers dues or PF dues/Government dues, as the case may be.
12. Under these circumstances, the direction as prayed for cannot be granted. However, it is Page 5 of 6 C/MCA/2076/2013 ORDER observed that as and when the workers' dues are finalised and/or the Government dues are finalised, the question of disbursement of amount to PF authority may be finalised.
13. Application disposed of accordingly.
(JAYANT PATEL, J.) bjoy Page 6 of 6