TaxTMI 
TaxTMI 
2024 (8) TMI 1201
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....o the Talathi/Revenue Officers for recording of charge in the rights column of secured assets, which have been effectuated by virtue of Mutation Entry No. 37953 and Mutation Entry No. 5367. FACTS 3. Petitioner-Bank has claimed that it is a banking society registered under the Maharashtra Co-operative Societies Act, 1960 and has formed banking consortium in respect of loan facilities availed by Respondent No. 4 (M/s. Shree Ganesha Packing Co.) vide bank sanction letter dated 18th January 2014. In this transaction, Petitioner Bank is a lead bank and is a member bank of consortium as per prevailing banking laws. The consortium is a secured creditor as per the Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002 (for short 'SARFAESI Act'). 4. Respondent No. 4 - borrower, was granted loan facilities by Petitioner - Bank, in the year 2013, of around Rs.7.26 crore. By a further letter dated 2nd September 2016, the Respondent No. 4- borrower applied for an increase for additional term loan by Rs.1.50 crore and cash credit limit of Rs.2.50 crore, to the consortium member Banks. In turn, the consortium Banks sanctioned, renewed and approv....
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....ereby denying the allegations, and bringing on record the correct facts. 13. On 24th January 2020, the amended SARFAESI Act came into force, thereby inserting in the Principal SARFAESI Act, after Section 26-A, Chapter IV-A- Registration by Secured Creditors and other creditors. By the said amendment Section 26B to 26E were inserted. 14. In the meanwhile, the Petitioner - Bank approached the District Magistrate, Nashik, under Section 14 of the SARFAESI Act, by filing Securitisation Application No. 233 of 2020, on 10 November 2020. The Additional District Magistrate vide order dated 25th February 2021 passed an order for possession of the secured assets. Pursuant thereto possession notice was issued by Tahsildar, Nashik, on 1st November 2021. The Petitioner - Bank took over the possession of the secured assets, vide panchanama dated 18th November 2021. 15. On 22nd November 2021, the Petitioner - Bank received the demand notice for recovery of arrears of dues, for the assessment period from 1st April 2017 to 31st June 2021 under Section 33 (1) of MVAT Act, from Respondent No. 3. Thereafter, the Petitioner - Bank received Demand Notice dated 9th March 2022 for a further assessment p....
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....provisions of Section 37 of the MVAT, which establishes the precedence of a secured creditor in favour of Sales Tax dues. It was prayed that the Writ Petition should be dismissed with costs. 20. Mr. Bharat Raichandani, advocate appeared for the Petitioner - Bank, made his submissions:- (i) He submitted that the Petitioner - Bank on 17th March 2017 registered, Security Interest with CERSAI. The Respondent Nos.2 and 3 have not registered their purported claim against Respondent No. 4, with CERSAI. Hence, after the amendment to Section 26 of the SARFAESI Act, under the provisions of Section 26-E, the debts due to Petitioner - Bank get priority over the dues of Respondent Nos. 2 and 3. (ii) Section 35 of the SARFAESI in clear terms mentioned that the provisions of SARFAESI override the provisions of other laws. (iii) Section 37 of the SARFAESI Act clearly provides that the provisions of the SARFAESI Act shall be in addition to and not in derogation of other Acts. (iv) Hence, the Full Bench of this Court in Jalgaon Janta Sahakari Bank Ltd. and another vs. Joint Commissioner of Sale Tax Nodal 9, Mumbai and another 2022(5) Mh.L.J.691 has clarified the provisions as far as prio....
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....rity." 24. The Full Bench of this Court in Jalgaon Janta Sahakari Bank Ltd. and another (supra) has clarified the position of law as per Section 26-E. In paragraphs 78, 79, 84, 85, 88 and 150 of the said judgment it has held 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 SARFAESI Act envisages benefits to a secured creditor who is diligent and obtains CERSAI registration while depriving a secured creditor of even taking recourse to Chapter III without the requisite registration. 84. The fact that the BST Act and the MVAT Act, which are under consideration, expressly make it subordinate or subservient to any Central legislation creating fi....
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....d 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 Chapter IV-A of the SARFAESI Act was made effective and enforceable, the relevant department of the State Government despite attachment orders being issued by the competent authority can only avoid compliance of sub-section (4) of section 26B at its own peril. We hold that attachment orders issued post 24 th January 2020, if not filed with the Central Registry, any department of the Governm....