EPFO assessment proceedings and claims initiated during Section 14 moratorium are legally impermissible and unenforceable.

The Corporate Debtor (CD) was admitted into Corporate Insolvency Resolution Process (CIRP) on 09.04.2019, triggering a moratorium under Section 14 of the IBC.

The Respondent (EPFO) received notice of insolvency on 25.06.2019 but failed to file a claim within the prescribed timeline.

Instead, the EPFO initiated and continued assessment proceedings under Sections 7A, 14B, and 7Q of the EPF & MP Act during the moratorium, eventually passing a demand order for ₹1,78,18,960 on 21.11.2023.

By this time, the Committee of Creditors (CoC) had already approved a resolution plan (06.08.2020), which was pending approval before the Adjudicating Authority (NCLT).

The NCLT allowed the EPFO’s delayed claim and made adverse remarks against the Resolution Professional (RP) for non-disclosure.

The RP and CoC appealed this order.

Whether assessment proceedings under the EPF & MP Act can be continued by the EPFO after the imposition of a moratorium under Section 14 of the IBC.

Whether claims based on assessments conducted during the moratorium period are admissible in the CIRP.

Whether new claims can be entertained after the Resolution Plan has been approved by the CoC and is pending before the Adjudicating Authority.

The court primarily applied Section 14(1) of the IBC, which imposes a "statutory freeze" on all proceedings against the CD to preserve assets during CIRP.

It relied on *EPFO vs. Jaykumar Pesumal Arlani*, which established that while assessment can occur during liquidation under Section 33(5), it is strictly prohibited during CIRP under Section 14(1).

The court further applied the principle from *Essar Steel vs. Satish Kumar Gupta* and *M/s RP Infrastructure Ltd. vs. Mukul Kumar*, holding that the IBC is a time-bound process and allowing "hydra-headed" undecided claims after plan approval by the CoC would jeopardize the resolution process.

Section 238 of the IBC was noted to have an overriding effect over inconsistent provisions in other statutes.

The Tribunal reasoned that the NCLT erred by treating CIRP and liquidation interchangeably; while provident fund dues do not form part of the "liquidation estate," the CD in this case was still in the CIRP phase.

Under Section 14(1), the "proceeding" for assessment by EPFO is a move against the CD's assets and is thus prohibited during the moratorium.

Consequently, any demand resulting from such a prohibited assessment is unenforceable.

Regarding the delay, the Tribunal found that the EPFO was negligent despite having notice of the CIRP since 2019.

Since the resolution plan was already approved by a 100% vote of the CoC in 2020, admitting a claim in 2024 would make the CIRP an "endless process".

Finally, the Tribunal defended the RP, noting he could not disclose proceedings that were not provided by the suspended management or the EPFO itself, thus finding no breach of CIRP Regulation 36(2)(h).

It held that assessment proceedings continued during the moratorium are non-est in law and claims arising therefrom cannot be pressed in CIRP.

The claim was also rejected for being filed after the CoC's approval of the resolution plan.

The Tribunal specifically ordered the expunction of adverse remarks against the RP's conduct at paragraphs 14 and 16 of the original order, concluding the RP acted within his mandate.