In a ruling that re-aligns the tension between social-security statutes and insolvency law, the National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, has held that contributions collected by an employer for the Employees’ State Insurance Corporation (ESIC) never become the property of the corporate debtor and must be ring-fenced from the liquidation estate. The judgment, delivered on 24 September 2025 in Company Appeal (AT)(Ins) No. 301 of 2024, upsets an order passed by the Ahmedabad bench of NCLT on 28 November 2023 and directs that Rs 1,20,80,940/- of ESI dues be kept out of the distributable pool available to other creditors of Gupta Dyeing & Printing Mills Pvt. Ltd., a company now in liquidation.
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