Home Case Index All Cases VAT and Sales Tax VAT and Sales Tax + HC VAT and Sales Tax - 2009 (7) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2009 (7) TMI 1154 - HC - VAT and Sales TaxWhether the State Government can claim priority over another person, whose debt is also a secured debt? Held that:- Security agreement is already existing between the bank and borrower, as defined under section 2(zb) which means an agreement, instrument or any other document or arrangement under which security interest is created in favour of the secured creditor including the creation of mortgage by deposit of title deeds with the secured creditor. If the status of the State is looked into, it will be evident that it can claim priority of debt over others in regard to the arrears of tax due to the State. This apart, the assets being secured assets with the Bank, having its secured interest over the property, the Bank being a secured creditor and its debt being a secured debt, we hold that the principle of first charge/ priority of State over the property will not be applicable in the present case. We, accordingly, set aside the impugned judgment dated september 17, 2008 Reported as Indian Bank v. Commercial Tax Officer [2008 (9) TMI 882 - MADRAS HIGH COURT] passed by the learned single Judge made in W.P. No. 18975 of 2007 and also the gazette Notification No. 01 dated January 5, 2007 and consequential order bearing No. NK.A3.2310/2002 dated March 16, 2007 so far as it relates to the land which was the secured assets of the bank and which has already been sold. W.P. allowed.
|