Pf amount ...liable to attachment..?
prashant1314
(Querist) 03 October 2011
This query is : Resolved
Dear Experts,
One employee Mr. X died in Dec-2009 after 12 years continuous service prior to that he had availed loan of Rs. 1.5lakh from bank B in 2008
Due to his death His wife & two children ( son - 08 years, daughter - 06 years ) could not pay the EMIs for the loan
Can the bank B compel the legal heirs to clear the debt ( By adjusting PF & Gratuity Amount )towards Bank B?
If yes, How?
prabhakar singh
(Expert) 03 October 2011
PF CERTAINLY CAN NOT BE PROCEEDED AGAINST IN REALIZATION OF A DEBT EVEN AFTER A DECREE OF COURT BUT NOT SO MUCH SURE ABOUT GRATUITY.
Sailesh Kumar Shah
(Expert) 03 October 2011
Provident fund, gratuity shall not be attached.
R.Ramachandran
(Expert) 03 October 2011
Whether the deceased was an employee of the same bank "B"?
prashant1314
(Querist) 03 October 2011
Dear Mr. Ramchandra,
Deceased was working in Engineering Company.
prabhakar singh
(Expert) 03 October 2011
get an injunction order against BANK now when both Pf n Gratuity got confirmed.
prashant1314
(Querist) 03 October 2011
Dear Experts,
My question is Can Bank compel the legal heirs to repay the Loan amount out of PF & Gratuity?
R.Ramachandran
(Expert) 03 October 2011
You have to first answer our query if you want reply to your query.
When you say that the employee availed loan from Bank B, please indicate whether the person was an employee of Bank B or not?
prashant1314
(Querist) 03 October 2011
Dear Sir,
I have already written in above post he was employee of Engineering Company
Advocate. Arunagiri
(Expert) 03 October 2011
The bank is having every right to sue the legal heirs, but can not attach the PF.
prashant1314
(Querist) 03 October 2011
Thanks a lot Mr. Arunagiri I got my answer.
R.Ramachandran
(Expert) 03 October 2011
HAving posted your reply, you should have waited for some more time to get response. Instead you wrote: "Dear Experts, My question is Can Bank compel the legal heirs to repay the Loan amount out of PF & Gratuity?"
Therefore, I asked you to give reply first.
Any way, while the PF cannot be attached, the bank can certainly go after the gratuity amount of the deceased to recover its dues. The age of the children of the deceased cannot be a consideration for the bank not to effect recovery of its dues.
prashant1314
(Querist) 03 October 2011
Dear All Experts,
Thank a lot for your kind responses & reply/s
Raj Kumar Makkad
(Expert) 03 October 2011
Shah! Can you tel me citation wherein it is mentioned that gratuity of a deceased loanee cannot be attached for repayment of his loan amount?
It is a news for me. PF cannot be attached and gratuity can be attached, it was in my knowledge as on date but now you have added to my knowledge. I shall be obliged if you cite some case law.
RAJU O.F.,
(Expert) 04 October 2011
PF and gratuity cannot be attached. For settlement of the loan the legal heirs would be liable. Hence speak with the higher officials of the bank and have an amicable settlement.
Sailesh Kumar Shah
(Expert) 04 October 2011
Shri Raj Kumar Makkad,
Sir,
For your kind perusal:-
A single judge bench of Justice K.A. Puj gave this ruling while allowing a petition of Vithalbhai Barot and setting aside an order of a civil court of Mehsana.
According to the case details, the Dudhsagar Dairy Employees Credit and Supply Cooperative Society Limited filed a suit before the court for recovery of 15.3 lakh against Barot.
This was decreed by the court in 1996. Against this order, Barot filed an appeal before the Gujarat State Cooperative Tribunal, which dismissed it.
Thereafter, the Dudhsagar Society filed a case before a civil court of Mehsana for execution of the decree. During the pendency of the case, it also petitioned the court for directions to the Mehsana District Milk Purchasers Cooperative Society Limited, that the amount which Barot has to receive for superannuation, gratuity, provident fund and leave encashment, may be directly paid to the Dudhsagar Society for settling its dues.
Barot objected to this on various grounds but the civil court in 2004 issued directions and Rs.3.66 lakh were deducted from Barot's entitlement and credited to the account of the Dudhsadar Society.
This order was challenged in high court.
After hearing both sides, the high court in an order made available on Saturday ruled: "If the amount of provident fund as well as gratuity payable to the petitioner (Barot) is credited to the account of the respondent (Dudhsagar Society) pursuant to the garnishee order passed by the learned Civil Judge, the same is immediately required to be returned to the employer of the petitioner as the said amount, under no circumstances, can be attached by the respondent."
Thanks
With Regards,
Raj Kumar Makkad
(Expert) 05 October 2011
Has the aforesaid judgment published in any law book? If yes, provide its exact citation please.
Please also confirm whether this judgment has become final?
