Calcutta High Court: A Single Judge Bench of Justice Shampa Dutt (Paul) dismissed a writ petition challenging an order directing the payment of gratuity to an employee. The court ruled that gratuity payments remain a statutory obligation even after a company undergoes Corporate Insolvency Resolution Process (CIRP). It held that Section 36(4)(a)(iii) of the Insolvency and Bankruptcy Code explicitly excludes gratuity funds from forming part of the corporate debtor’s estate. Lastly, the court noted that CIRP merely facilitates a change in management and does not extinguish a company’s obligations under the labor laws.
Background
Stesalit Limited had undergone a change in management following the Corporate Insolvency…
