Dismissed

M/S Edelweiss Asset Reconstruction Limited v. Regional Pf Commissioner -Ii

Karnataka HC1 Feb 2024WP/2543/2023

Case brief

AI extract

What is this about?

The High Court of Karnataka dismissed a writ petition filed by Edelweiss Asset Reconstruction Limited (trustee) challenging an attachment order and show-cause notice issued by the EPFO. The court held that the undisputed dues could not be questioned and the petitioner, as an intermediary, could not impose conditions on remittance. The petition was found to lack merits and was dismissed, with the d

What did the court decide?

The amount in deposit directed to be transmitted to the respondent's account; pending I.A.'s struck off.

M/S Edelweiss Asset Reconstruction Limited… — Pension and Retirement Benefits | Karnataka HC (2024)

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1 - NC: 2024:KHC:4702 WP No. 2543 of 2023

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 1^ST DAY OF FEBRUARY, 2024

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BEFORE

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THE HON'BLE MRS JUSTICE K.S. HEMALEKHA WRIT PETITION NO. 2543 OF 2023 (L-PF)

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BETWEEN:

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M/S. EDELWEISS ASSET RECONSTRUCTION LIMITED, (ACTING IN CAPACITY AS TRUSTEE OF EARC TRUST SC 131) EDELWEISS HOUSE, OFF CST ROAD, KALINA MUMBAI, MAHARASHTRA - 400 098., REP BY ITS AUTHORISED SIGNATORY MR. K. RADHAKRISHNAN NAIR, INCORPORATED UNDER COMPANIES ACT, 1958. …PETITIONER

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(BY SRI. VIGNESH SHETTY., ADVOCATE)

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AND:

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Digitally signed by MAHALAKSHMI B M Location: HIGH REGIONAL PF COMMISSIONER -II COURT OF KARNATAKA AND RECOVERY OFFICER, RO BENGALURU (KORAMANGALA) EMPLOYEES PROVIDENT FUND ORGANSIATION ANNAPOORNESHWARI COMPLEX SY NO 37/1 6TH MAIN, SINGASANDRA HOSUR MAIN ROAD BENGALURU 560068

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…RESPONDENT

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(BY SMT. NANDITA HALDIPUR., ADVOCATE)

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2 - NC: 2024:KHC:4702 WP No. 2543 of 2023

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THIS W.P. IS FILED UNDER ARTICLE 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE ATTACHMENT ORDER BEARING NO. KN/PF/RO/KOR(RECOVERY)/C1/34911/R-73/2022-23 DTD. 24.11.2022 ISSUED BY RESPONDENT (ANNX-H) AND ETC,.

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THIS PETITION, COMING ON FOR DICTATING ORDERS, THIS DAY, THE COURT MADE THE FOLLOWING:

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ORDER

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The petitioner is a registered company under the Companies Act, 1956 under the name and style of M/s. Edelweiss Asset Reconstruction Ltd. (“EARC”), assailing the order of attachment dated 24.11.2022 at Annexure – “H” and notice dated 30.01.2023 at Annexure – “K”.

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Heard Sri Shetty Vignesh Shivaram, learned

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counsel for the petitioner and Smt. Nandita Haldipur, learned counsel appearing for the respondent.

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The grievance of the petitioner-EARC is that the respondent-EPFO cannot fasten all the liabilities on the petitioner when there are other secured creditors of the establishment, who also have realized amount from sale of the properties. It is stated that the respondent without considering the same has proceeded to issue show-cause

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NC: 2024:KHC:4702 WP No. 2543 of 2023

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notice dated 30.01.2023 demanding to pay a sum of Rs. 78,43,629/- and if failing to pay the amount, the petitioner to be declared as a deemed defaulter.

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Respondent has filed objections to the petition,

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inter alia , contending that the total dues by one M/s. Acropetal Technologies Pvt. Ltd., is Rs.2,08,94,800/for having not remitted the Provident Fund Contribution, notice under Sections 14B and 7Q of the Employee’s Provident Funds & Miscellaneous Provisions Act, 1952 (hereinafter referred to as “EPF and MP Act” for the sake of convenience) was issued to the establishment to show-

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cause and to represent their case in person. The respondent passed orders for recovery of the amount stated supra and recovery action was by way of attachment. The establishment submitted that the property is mortgaged to State Bank of Travancore, who have engaged the petitioner-EARC to sell the property.

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The immovable property bearing No.74/75, situated at 3^rd Cross, 1^st Main, N.S. Palya, Bannerghatta

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4 - NC: 2024:KHC:4702 WP No. 2543 of 2023

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Road, Bangalore, was also attached by the respondent, the establishment submitted that the said property was mortgaged to State Bank of Travancore and the Bank has assigned the debt of the Company with underlining securities to EARC through public sale under SARFAESI Act, 2002. The respondent directed the State Bank of Travancore and petitioner-EARC to remit the outstanding dues, petitioner informed the respondent that it is willing to remit the amount of Rs.78,43,629/- subject to the confirmation that the said amount would be towards full and final settlement and the respondent-EPFO will not raise any further demands from petitioner-EARC with reference to the PF dues of M/s. Acropetal Technologies Pvt. Ltd.

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The material on record would reveal that the petitioner-EARC is willing to remit Rs.78,43,629/- subject to the confirmation that the said amount would be towards full and final settlement and respondent-EPFO will not raise any further demands from petitioner-EARC with

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5 - NC: 2024:KHC:4702 WP No. 2543 of 2023

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respect of PF dues of M/s. Acropetal Technologies Pvt. Ltd. There cannot be any condition imposed by the petitioner for undisputable dues recovered from M/s. Acropetal Technologies Pvt. Ltd., through the petitioner who is just an intermediator. The petitioner also cannot contend that the respondent-EPFO has not demanded any amount from AXIS Bank and wants to recover the entire amount from petitioner only, which ground is highly unsustainable. The petitioner cannot contend that the respondent is discriminating the petitioner-EARC with the other secured creditors. The undisputed amount by way of order of attachment cannot be called in question by the petitioner in the present proceedings and the writ petition is devoid of merits and liable to be dismissed. Accordingly, the Court pass the following:

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ORDER

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(i) The writ petition is dismissed .

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6 - NC: 2024:KHC:4702 WP No. 2543 of 2023

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(ii) The amount in deposit vide order dated

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02.02.2023 is directed to be transmitted to the respondent’s account in accordance with law.

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In light of the dismissal of the writ petition, pending

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I.A.’s does not survive for consideration.

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Sd/JUDGE

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DDU List No.: 1 Sl No.: 18

M/S Edelweiss Asset Reconstruction Limited v. Regional Pf Commissioner -Ii

Case brief

What is this about?

What did the court decide?

M/S Edelweiss Asset Reconstruction Limited v. Regional Pf Commissioner -Ii

Case brief

What is this about?

What did the court decide?

What the court decided

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Statutes considered

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