Prior registered security interest prevails over later State charge, and consequential revenue entries cannot override that priority.

A prior registered security interest of a bank prevails over a later-created State charge under the SARFAESI regime, including the priority recognised by Section 26E. Where the bank's charge was created earlier, the subsequent State charge and consequential mutation entries could not displace that superior secured interest. The auction purchaser was therefore entitled to take the property subject to the bank's prior charge. On that basis, the impugned administrative orders creating the State charge and the related revenue entries were set aside.

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Issues: Whether the petitioner-bank, having created and registered its charge earlier in time, had priority over the State's subsequent charge over the secured property, and whether the impugned orders and resulting revenue entries could be sustained.

Analysis: The earlier charge of the petitioner-bank was created in 2011, whereas the State's charge was created only in 2018. The dispute was governed by the priority accorded to secured creditors under the SARFAESI regime, including Section 26E, as considered in prior binding and coordinate-bench decisions relied upon by the Court. The Court accepted that a subsequent State charge cannot displace the prior security interest of the bank, and that the auction purchaser takes the property in accordance with the bank's superior charge. On that basis, the impugned administrative orders directing creation of the State's charge and the consequential mutation entries could not be sustained.

Conclusion: The issue was decided in favour of the petitioner-bank, and the State's subsequent charge was held not to prevail over the bank's prior security interest.

Final Conclusion: The writ petition succeeded and the challenged orders and consequential revenue entries were set aside in consequence of the petitioner's superior secured interest.

Ratio Decidendi: A prior registered security interest of a secured creditor prevails over a later-created State charge, and a subsequent revenue entry or administrative order cannot displace that statutory priority.

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