The Principal Bench of the National Company Law Appellate Tribunal (NCLAT) at New Delhi recently clarified that the Employees’ State Insurance (ESI) amount lying with a corporate debtor during liquidation proceedings is not part of the liquidation estate as per the Insolvency and Bankruptcy Code, 2016 (IBC).
The ruling was rendered by the appellate tribunal against an appeal by the Regional Director of the ESI Corporation challenging an order passed by the National Company Law Tribunal (NCLT), Ahmedabad, which had dismissed an application filed by the appellant seeking segregation of ESI dues from the estate of Gupta Dyeing Printing Mills Pvt. Ltd., the corporate debtor herein that was undergoing liquidation.
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