HOLDING COMPANY NOT LIABLE TO RECOVER PROVIDENT FUND DUES OF SUBSIDIARY: SC

The Supreme Court (SC) has reiterated that a holding company could not be held liable for recovery
of provident fund dues of its subsidiary company. The Orissa High Court had allowed the petition of ABS Spinning Orissa Ltd, which had challenged the demand of the provident fund commissioner for
provident fund dues. The commissioner appealed to the SC which dismissed the petition stating that “we are of the view that the subsidiary company has an independent existence as against the holding company and therefore the holding company is not liable to clear the provident funds dues of its
subsidiary company”.