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2020 (12) TMI 1263 - HC - Indian LawsSeeking to proceed against the secured property involved - recovery of dues - validity of attachment made by the respondents subsequent to creation of equitable mortgage created in favour of the petitioner - effect on marketability - whether the State has better right over the secured assets for recovery of its dues? - HELD THAT:- This question is no more res integra. The petitioner has rightly relied on the judgments of this Court in TRAVANCORE DEVASWOM BOARD VERSUS LOCAL FUND AUDIT [2020 (5) TMI 691 - KERALA HIGH COURT] and STATE BANK OF INDIA AND ORS. VERSUS STATE OF KERALA AND ORS. [2019 (7) TMI 1684 - KERALA HIGH COURT] where it was held that the sale carried out either under the SARFAESI Act or under the RDB Act takes precedence over the statutory charges due to the Government created under KVAT Act or under other State Enactments after the Amendment Act of 2016. A secured creditor in whose favour a security interest has been created thus has priority in sale and payment over all other statutory charge holders. Section 26E of the SARFAESI Act and Section 31B of the RDB Act create a 'First Charge' by way of a priority to the Banks/Financial Institutions to recover and satisfy their debts, notwithstanding any statutory 'First Charge' in favour of the Revenue. Petition allowed.
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