Workmen's priority under SARFAESI is unavailable without winding-up proceedings, leaving secured enforcement unimpeded.

Workmen could not obstruct enforcement under SARFAESI or claim priority over a secured creditor because the company was neither in liquidation nor subject to winding-up proceedings. Section 13(9) of the SARFAESI Act gives special treatment to sale proceeds only in the limited situations of multiple secured creditors or where liquidation or pending winding-up attracts the provisos; section 529A of the Companies Act, 1956 operates in winding-up contexts. As the alleged workmen's dues were neither adjudicated nor quantified, no direction could be issued for payment from the realised assets, and the recovery challenge was not maintainable. The secured creditor was therefore entitled to continue enforcement.

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Issues: Whether workmen of a company, in the absence of any winding-up order or winding-up proceedings, can obstruct proceedings under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 or claim priority over the secured creditor under section 13(9) of that Act and section 529A of the Companies Act, 1956.

Analysis: Section 13(9) of the SARFAESI Act contemplates special treatment of sale proceeds only where there are multiple secured creditors and, through its provisos, in cases where the company is in liquidation or where winding-up proceedings are pending. Section 529A of the Companies Act, 1956 gives workmen's dues priority in winding-up situations. The petitioners' alleged dues were neither adjudicated nor quantified, and the company was neither wound up nor under winding-up proceedings. In that setting, the workmen could not restrain the secured creditor from proceeding against the secured assets, nor could they compel payment of workmen's dues out of the realised amounts. The challenge to the recovery proceedings was therefore not maintainable and no direction for payment could be issued on the facts.

Conclusion: The claim of priority and the request to quash the recovery proceedings were rejected; the workmen were held not entitled to impede the SARFAESI and recovery proceedings in the absence of winding up.

Final Conclusion: The writ petition failed in substance because the statutory priority for workmen arises only in a winding-up context, leaving the secured creditor free to continue enforcement against the secured assets.

Ratio Decidendi: Workmen cannot invoke section 13(9) of the SARFAESI Act to obstruct enforcement against secured assets or claim priority over realised proceeds unless the company is in liquidation or winding-up proceedings are pending, and the workmen's dues are otherwise capable of legal quantification.

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