Priority of prior secured mortgages prevails over subsequent income-tax attachments, enabling enforcement sales and purchasers' revenue-record mutation.

A secured creditor's prior mortgage and statutory enforcement rights under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 take priority over a subsequent income-tax attachment. Where security interest was created before the attachment, the secured creditor's first charge prevails because no statutory preference for Crown debt displaces secured debt. A later tax attachment cannot defeat a sale undertaken in enforcement of the pre-existing mortgage, and cannot obstruct release of the sale deed or mutation of purchasers' names in revenue records.

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Issues: Whether the secured creditor's prior mortgage and enforcement rights prevail over the subsequent income-tax attachment of the secured property.

Analysis: The security interest in the plots was created in favour of the bank before the Income Tax Department attached them. The secured creditor's statutory enforcement rights and first charge over secured assets under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 prevail over the income-tax claim. In the absence of a statutory preference for Crown debt, secured debts take priority; an attachment made after creation of the mortgage cannot defeat a sale conducted pursuant to recovery proceedings on that pre-existing security interest.

Conclusion: The bank's secured charge has priority over the income-tax attachment; the attachment cannot obstruct release of the sale deed or mutation of the purchasers' names in the revenue records.

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