TMI Blog2003 (12) TMI 627X X X X Extracts X X X X X X X X Extracts X X X X ..... facturing timber products in the district of Khurda. When O.P. No. 4-Company could not repay the loan incurred by it from the O.P. No. 3, Orissa State Financial Corporation ('OSFC' in short), the latter seized the unit of O.P. No. 4 under Section 29 of the State Financial Corporations Act, 1951 ( SFC Act ). Pursuant to an agreement-cum-undertaking dated 4.1.1999 (Annexure-4), OSFC transferred the fixed assets of O.P. No. 4 and delivered the same to the petitioner and after taking delivery of possession of the fixed assets of O.P. No. 4-Company, the petitioner by letter dated 24.6.1999 (Annexure-5) requested O.P. No. 1-Regional Provident Fund Commissioner, Orissa, for allotment of establishment code number under Section 1(3) of the E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to pay the past liabilities of O.P. No. 4 towards the provident fund and miscellaneous charges as well as damages and penal interest, if any. He further submits that as the petitioner has taken over the unit from the OSFC, O.P. No. 1 should have allotted a fresh code number to the petitioner instead of advising it to carry on with the code number of O.P. No. 4 thereby indirectly forcing the petitioner to take over the liabilities of O.P. No. 4. 3. A counter affidavit has been filed on behalf of O.P. Nos. 1 and 2 wherein the claim of the petitioner for allotment of a new code number has been refuted mainly on the ground that Section 17B of the EPF Act fixes the liability of payment of the unpaid provident fund dues of the employees of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the facts and circumstances of the present case, it is appropriate to mention here the undisputed facts. The unit initially belonged to O.P. No. 4 and the same was seized by the OSFC under Section 29 of the SFC Act on failure of O.P. No. 4 to clear the dues of the OSFC. Ultimately the unit was transferred to the petitioner. I may now extract hereunder Section 29 of the SFC Act : 29. Rights of Financial Corporation in case of default : (1) Where any industrial concern, which is under a liability to the Financial Corporation under an agreement, makes any default in repayment of any loan or advance or any instalment thereof or in meeting its obligations in relation to any guarantee given by the Corporation or otherwise fails to comply wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ial Corporation has taken any action against an industrial concern under the provisions of Sub-section (1), the Financial Corporation shall be deemed to be the owner of such concern, for the purposes of suits by or against the concern, and shall sue and be sued in the name of the concern. The provisions mentioned above clearly indicate that in case of default in payment of any loan or advance or any instalment thereof or failure to comply with the terms of the agreement by an industrial concern, the Financial Corporation shall have the right to take over the management or possession or both of the industrial concerns, as well as the right to transfer by way of lease or sale and realise the property pledged, mortgaged, hypothecated or as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry as follows : the person who has ultimate control over the affairs of the factory, and, where the said affairs are entrusted to a managing agent, such agent shall be deemed to be the occupier of the factory; Section 8 of the EPF Act provides the mode of recovery of moneys due from employers which is as follows : Any amount due : (a) from the employer in relation to an establishment to which any Scheme or the Insurance Scheme applies in respect of any contribution payable to the Fund or, as the case may be, the Insurance Fund, damages recoverable under Section 14B, accumulations required to be transferred under Sub-section (2) of Section 15 or under Sub-section (5) of Section 17 or any charges payable by him under any oth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the value of the assets obtained by the transferee by such transfer. The transfer by the employer of the establishment contemplated under Section 17B is an act by the employer. Here is a case where the transfer has not been made by the employer but after seizure of the unit/establishment, the same was transferred by the OSFC to the present petitioner. There is no indication that Section 17B contemplates transfers otherwise than by an employer as defined in the EPF Act in relation to an establishment. By a Court sale or otherwise a transfer takes place by operation of law and not by any transaction inter vivos. In that sense, it is an involuntary sale against the wishes of the person whose property is sold. That can hardly be called a tran ..... X X X X Extracts X X X X X X X X Extracts X X X X
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