TaxTMI 
TaxTMI 
2024 (7) TMI 1309
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....ers failed to maintain the loan account, the Petitioner-Bank declared the account of Respondent no.6 as NPA, on 28/2/2017. Subsequently, the Petitioner Bank issued a demand notice dated 6/6/2019, under Section 13 (2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short 'SARFAESI Act') to Respondent no.6 (borrower), demanding a sum of Rs.1,29,67,873/-, together with interest thereon within 60 days. As the borrower did not comply with the demand as made in notice under Section 13 (2) of the SARFAESI Act. The Petitioner bank through its authorized officer took symbolic possession of the secured assets on 25/9/2019 and further issued Possession Notice under Section 13 (4) of the SARFAESI Act, which was published in newspapers. 5. The Petitioner Bank thereafter filed an Application No.401/2022 before the District Magistrate, Pune under Section 14 of the SARFAESI Act for seeking assistance for taking physical possession of the secured assets. Consequently, by an order dated 10/6/2022, the District Magistrate, Pune, was pleased to allow the Application No.401/2022, with direction to Tahsildar to take physical possession ....
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....no. 3, confirming acceptance of highest bid amount. 8. Thereafter, Respondent No. 2 (the Deputy Commissioner of Sales Tax), served attachment Orders dated 14/9/2022 and 15/9/2022 in respect of the secured assets of Respondent no.6 (borrower) for non-payment of Sales Tax and said orders of attachment were copied to the Petitioner bank, and the Chairman of the respective Co-operative Societies, wherein the secured assets were situated, ward officers, Tahsildars. 9. The Petitioner Bank registered the mortgage charge of Petitioner-Bank in respect of secured assets with Central Registry of Securitisation Asset Reconstruction and Security Interest of India (for short 'CERSAI') on 4/10/2022. 10. The present Writ Petition challenges the Orders of Attachment dated 14/9/2022 and 15/9/2022 issued by Respondent No. 2 (the Deputy Commissioner of Sales Tax). 11. Respondent No. 2 appeared in the matter and filed their reply opposing the Writ Petition. 12. It is submitted that the Petitioner-Bank's CERSAI registration was only on 4/10/2022. It is further submitted that Section 37 of MVAT mentions that the first charge on the property would be of Central Act. Therefore, the Writ Peti....
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....red the secured assets under the Central Registry of CERSAI. 19. There is no dispute that Respondent No. 2 (The Deputy Commissioner of Sales Tax) has registered its claim of arrears of sales tax with regard to Respondent no.6 (M/s. Anupama Enterprises) on 20/2/2023 and 28/2/2023, only after the Petitioner Bank had registered the mortgage/charge of Bank in respect of secured assets. The Full Bench of this Court in Jalgaon Janta Sahakari Bank Ltd. (supra) has clarified the issue of priority of security creditor. Paragraphs 78, 79, 84, 85, 88 and 150 of the said judgment reads as under:- "78. Section 26-E, also beginning with a non-obstante clause, is unambiguous in terms of language, effect, scope and import. A 'priority' in payment over all other dues is accorded to a secured creditor in enforcement of the security interest, if it has a CERSAI registration, except in cases where proceedings are pending under the provisions of the Insolvency and Bankruptcy Code, 2016. 79. The disabling provision in section 26D and the enabling provision in section 26-E, both begin with non-obstante clauses, as noticed above. The scheme of Parts III and IV-A of the SARFAES....
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....State Government or local authority and ordains that the dues of a secured creditor will have 'priority', i.e., take precedence. Significantly, the statute goes quite far and it is not only revenues, taxes, cesses and other rates payable to the State Government or any local authority but also those payable to the Central Government that would have to stand in the queue after the secured creditor for payment of its dues. 150. The contention that rules are yet to be framed for making subsection (4) of section 20B operational is wholly incorrect. By a notification dated 24th January 2020 issued by the Department of Financial Services in the Ministry of Finance, Govt. of India, published in the Gazette of India of even date, the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest(Central Registry) (Amendment) Rules, 2020 were duly notified whereby amendments were incorporated in the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (Central Registry) Rules, 2011 (hereafter '2011 Rules', for short). In view of the amendments that have now been incorporated in the 2011 Rules with effect from the date....