Subhiksha CEO personally liable for PF dues: EPFO
R Subramanian, the Managing Director of Subhiksha Trading, is personally liable for paying in the Rs 1.76-crore statutory provident fund dues, while absolving other directors of the embattled neighbourhood retail chain.business Updated: Feb 21, 2009 10:11 IST
R Subramanian, the Managing Director of Subhiksha Trading, is personally liable for paying in the Rs 1.76-crore statutory provident fund dues, while absolving other directors of the embattled neighbourhood retail chain.
The Regional Provident Fund Commissioner, Chennai has directed Subramanian to remit all the provident fund contributions remaining unpaid since June 2008 “immediately without any further delay”.
The PF commissioner has ruled that “The specific personal responsibility or involvement of the nominee directors and independent directors is found not established. Accordingly, the nominee directors and the independent directors other than R Subramanian are found not personally liable for the current period of default on the part of the establishment.”
The dues, which needs to be paid immediately by Subramanian works out to be around Rs 1.76 crore, it added.
The PF commissioner has, however, noted that the financial responsibilities of the investors (including ICICI Ventures) and bankers continue as per law.
Subramanian has filed an application with the PF commissioner to use accumulations in his provident fund account for discharging part of the dues payable by Subhiksha. Subramanian stopped drawing salary from Subhiksha on April 1, 2008.
Commenting on the EPFO enquiry, the company has said that Subramanian has offered the PF amount in his personal account "to be adjusted and treated as paid on behalf of the company towards part payment of the arrears and the request is being processed by the EPFO."
Vikram R Trivedi, Managing Partner at law firm Manilal Kher Ambalal & Co, who represented ICICI Ventures and its nominees directors on the board of Subhiksha, said in a statement, “The PF commissioner’s ruling is a vindication of the stand of our clients that R Subramanian is fully responsible for the operations of Subhiksha and my clients are only minority shareholders.”
ICICI Venture’s Managing Director, Renuka Ramnath, and its nominee directors Kannan Srinivasan and Rama Bijapurkar, last month resigned from the board of Subhiksha.