326. Overriding preferential payments
(1) Notwithstanding anything contained in this Act or any other law for the time
being in force, in the winding up of a company,—
(a) workmen’s dues; and
(b) debts due to secured creditors to the extent such debts rank under clause
(iii) of the proviso to sub-section (1) of section 325 pari passu with such dues,
shall be paid in priority to all other debts:
Provided that in case of the winding up of a company, the sums towards wages or
salary referred to in sub-clause (i) of clause (b) of sub-section (3) of section 325, which are
payable for a period of two years preceding the winding up order or such other period as
may be prescribed, shall be paid in priority to all other debts (including debts due to secured
creditors), within a period of thirty days of sale of assets and shall be subject to such charge
over the security of secured creditors as may be prescribed.
(2) The debts payable under the proviso to sub-section (1) shall be paid in full before
any payment is made to secured creditors and thereafter debts payable under that
sub-section shall be paid in full, unless the assets are insufficient to meet them, in which case
they shall abate in equal proportions.