Securitisation remedy survives provisional liquidation, but sale of secured assets still needs Company Court permission.

Secured creditors may invoke the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 notwithstanding the appointment of a Provisional Liquidator, because the statute was treated as having overriding effect and the pendency of company proceedings did not itself bar recourse to the secured recovery mechanism, subject to statutory compliance including section 13(9). Sale of secured assets in the liquidation context, however, remained under the Company Court's supervisory control, so prior permission was required before sale was completed. Workers' claims and statutory dues were preserved for consideration at the stage of sale confirmation.

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Issues: (i) Whether secured creditors could be permitted to initiate proceedings under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 despite the appointment of a Provisional Liquidator. (ii) Whether prior permission of the Company Court was required before sale of the secured assets.

Issue (i): Whether secured creditors could be permitted to initiate proceedings under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 despite the appointment of a Provisional Liquidator.

Analysis: The Securitisation Act was treated as having overriding effect, and the secured creditors were held entitled to proceed under that enactment after compliance with the statutory requirements, including the consent requirement under section 13(9). The pendency of company proceedings and the appointment of the Provisional Liquidator did not by itself justify denial of permission to invoke the statutory remedy under section 13.

Conclusion: Permission to initiate proceedings under the Securitisation Act was granted in favour of the secured creditors.

Issue (ii): Whether prior permission of the Company Court was required before sale of the secured assets.

Analysis: While measures under section 13, including notice and possession, could be pursued, the Court held that sale of the secured assets could not be completed without the Company Court's control in the liquidation context. The Court preserved the safeguard that workers' claims and statutory dues would be considered at the stage of sale confirmation.

Conclusion: Prior permission of the Company Court was required before the secured assets could be put to sale.

Final Conclusion: The application was allowed, the Official Liquidator was restrained from taking possession pending the statutory recovery proceedings, and the secured creditors were permitted to proceed under the Securitisation Act, subject to the requirement of obtaining prior approval before sale of the assets.

Ratio Decidendi: Secured creditors may invoke the Securitisation Act notwithstanding provisional liquidation, but sale of company assets in liquidation remains subject to the supervisory control of the Company Court.

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