TaxTMI 
TaxTMI 
2025 (9) TMI 1745
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....Limited, Bhuleshwar Division, 3 Panjrapole Lane, Mumbai 400004 (Secured Assets) on 30th November 2018. iii. The Petitioner registered its charge over the secured assets with the Central Registry of Securitisation Asset Reconstruction and Security Interest of India (CERSAI) on 22nd January 2019. iv. The Petitioner sanctioned a home equity loan of Rs. 75,00,000 (Credit Facility II) to the Borrowers on 31st March 2019. v. Repayment of Credit Facility II was secured by the Borrowers by memorandum recording past transaction of creation of mortgage by deposit of Title Deeds qua Flat 404 on 31st March 2019. vi. The Petitioner registered its charge over Flat 404 with the CERSAI on 2nd May 2019. vii. On 4th March 2022, Office of the Deputy Commissioner of Sales Tax (Respondent No. 1) vide letter to the Respondent No. 2 - Cosmos Sunshine M. B. Cooperative Housing Society Limited (Society) claimed alleged sales tax arrears of Mr. Lalchand Jain, Proprietor of M/s. Kajal Trading Co. (Borrowers) and asserted charge on Flat 901 for recovery of its alleged dues. viii. The Respondent No. 1 on 7th March 2022 issued an order of attachment of immov....
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....er having registered its charge over the secured assets with the Central Registry of Securitisation Asset Reconstruction and Security Interest of India (CERSAI) on 22nd January 2019 and 2nd May 2019, i.e. prior to the Respondent No. 1 registering its charge over Flat 404 with the CERSAI on 26th July 2023, the Petitioner as Secured Creditor is the first charge holder and the charge of the Respondent No. 1 would be subordinate to the dues of the Secured Creditor. 4. Mr. De'Souza has placed reliance upon paragraphs 75, 78, 89, 92, 148, 150, 153 and 154 of the Full Bench decision. He has submitted that Section 26E of the SARFAESI Act begins with a nonobstante clause, and use of the word 'priority' in the said provision is to be given effect to. The rights accorded to 'first charge' holders by Central as well as State legislation would be subordinate to the dues of the Secured Creditor. This is in view of there being a 'priority' in payment over all other dues is accorded to the Secured Creditor in enforcement of the security interest, if it has a CERSAI registration. 5. Mr. De'Souza has submitted that the Full Bench decision has further held that the attachment orders issued post....
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....f the aforementioned Writ Petition found that there was no material on record which would show that the Sales Tax Authorities had passed an order of attachment in conformity with the governing provisions of the MLR Code and the MRLR Rules, followed by a proclamation duly promulgated in the manner ordained by law. 9. Mr. De'Souza has submitted that in the present case, the Respondent No. 1 has not issued any proclamation in accordance with the Maharashtra Land Revenue Code ("MLRC") and Maharashtra Realization of Land Revenue Rules, 1967 ("1967 Rules"). As per Section 192 of the MLRC and Rule 11(2) of the 1967 Rules, any attachment of a property must be followed by a proclamation in a prescribed form. 10. Mr. De'Souza has referred to the Affidavit in Reply filed on behalf of the Respondent No. 1, which though asserting charge in respect of the secured assets has not brought any evidence on record to demonstrate compliance with Section 192 of the MLRC and Rule 11(2) of the 1967 Rules. 11. Mr. De'Souza has submitted that the Respondent No. 1's Reply is based on erroneous contentions viz. the mortgage of the secured assets is prior to the sanction of the credit facilities; Peti....
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....e aforementioned facts that the Petitioner has registered its charge over the secured assets with the CERSAI on 22nd January 2019 and 2nd May 2019. This is also borne out from Exh.E which is the registration of security interest acknowledgment Report. This shows the registration dates as of 22nd January 2019 and 2nd May 2019. The Respondent No. 1 had issued order of attachment for the secured assets / immovable property being Flat 404 on 7th March 2022, i.e. subsequent to the Petitioner's registration with CERSAI. Further, the Respondent No. 1 registered its charge over flat 404 with CERSAI on 26th July 2023, i.e. after registration of the Petitioner's charge over Flat 404 with CERSAI on 2nd May 2019. Thus, the Petitioner being Secured Creditor would have priority over the charge of Respondent No. 1, in enforcement of its security interest. This has been laid down by the Full Bench of this Court in Jalgaon Janta Sahakari Bank Ltd. (supra). It has been held that the use of the word 'priority' in Section 26E of the SARFAESI Act is that the rights accorded to 'first charge' holders by Central as well as State legislation would be subordinate to the dues of the Secured Creditor. ....