HC held gratuity dues do not form part of liquidation estate ...

Gratuity Dues Protected Outside IBC Liquidation Estate; Payment of Gratuity Act Applies Universally to All Employees

February 28, 2025

Case Laws IBC HC

HC held gratuity dues do not form part of liquidation estate under IBC and remain protected for workers' benefit. The controlling authority maintained jurisdiction as company continued operations under new management post-CIRP without entering liquidation. While respondent was a managerial employee rather than worker, Payment of Gratuity Act applies universally to all employees as labor legislation. With no specific gratuity fund maintained, entire dues were payable from company assets with priority over creditor claims. Court distinguished CIRP as creditor recovery mechanism from liquidation which terminates company existence. Controlling authority's jurisdiction to determine gratuity remained intact since company remained active. Petition challenging authority's jurisdiction dismissed.

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HC held gratuity dues do not form part of liquidation estate ...

Gratuity Dues Protected Outside IBC Liquidation Estate; Payment of Gratuity Act Applies Universally to All Employees

February 28, 2025

Case Laws IBC HC

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