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2024 (2) TMI 322 - HC - CustomsRecovery of dues - Petitioner’s right as a Financial Creditor is superior to the rights under the Customs Act, 1962 or not - sale of assets of Respondent No. 02 under the provisions of the SARFAESI Act 2002 - HELD THAT:- The only source of power for the respondents in purporting to address the impugned letter can be traced to Section 142A of the Customs Act, being a provision which recognizes the first charge in regard to any duty, penalty, interest or any other sum payable by an assessee or any other person under the Customs Act and such first charge is notwithstanding anything to the contrary contained in any Central Act or State Act, and thereafter, saving the provisions under the SARFAESI Act. On a cumulative reading of Section 142A of the Customs Act and Section 35 of the SARFAESI Act, it would be clear that the recovery as initiated by the petitioner under the SARFAESI Act cannot be impeded by the respondents by taking recourse to Section 142A of the Customs Act. The reason being that Section 142A itself is a provision which saves the provisions of the SARFAESI Act under which the action was resorted by the petitioner to recover its dues from respondent No. 2. In any event, it is well settled that unless there is a preference given to a Crown debt by a statute, the dues of a secured creditor like the petitioner would have preference over Crown debts. It may also be observe that in the present case the impugned letter has been addressed at the stage of investigation. It is averred in the reply affidavit that a final order-in-original is passed against respondent No. 2. It is informed by the learned Counsel for the petitioner that such order is subject matter of challenge in independent proceedings. Thus, the impugned communication in any event would pale into insignificance. The impugned communication dated 2 November 2015 is quashed and set aside - petitioner is permitted to proceed further in regard to the actions against respondent No. 2 and the secured assets, as initiated under the SARFAESI Act - petition allowed.
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