Overriding effect of debt recovery law protects purchaser's possession after sale in recovery proceedings despite winding-up intervention.

The Recovery of Debts Due to Banks and Financial Institutions Act, 1993 prevails over inconsistent proceedings under the Companies Act, 1956 by virtue of its overriding clause, so a District Magistrate cannot interfere with possession of property sold and delivered in recovery proceedings merely at the request of the Official Liquidator in winding-up proceedings. The interference order was therefore unsustainable and was quashed, and the purchaser was entitled to continue exercising rights over the property in accordance with law.

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Issues: Whether the District Magistrate could restrain interference with property purchased in recovery proceedings when the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 operates notwithstanding the Companies Act, 1956.

Analysis: The petition challenged the District Magistrate's order interfering with the petitioner's possession over property purchased through proceedings before the Recovery Officer and the Debts Recovery Tribunal. Section 34 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 gives that Act overriding effect over inconsistent laws, and the Court applied the principle that recovery proceedings under the said Act prevail over proceedings under the Companies Act, 1956. The property had been sold and possession delivered in the recovery process, so the District Magistrate could not interfere merely on the request of the Official Liquidator acting under winding up proceedings.

Conclusion: The interference order was unsustainable and was quashed. The petitioner was held entitled to continue exercising rights over the property purchased in the recovery proceedings, in accordance with law.

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