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2016 (12) TMI 410 - HC - Income TaxRecovery proceedings - attachment orders - 'Priority of Charge' - false claim on property in question - petitioner submitted a representation stating that they have purchased the property through a public auction conducted by the Recovery Officer, DRT, Chennai and as on date of sale, there was no attachment over the property - Held that:- Admittedly, the property was brought for public auction by the Dena Bank, which was a secured creditor. The question would be as to whether crown debts would have precedence over the debts payable to a secured creditor? This issue is no longer resintegra and has been answered by the Full Bench of this Court in the case of The Assistant Commissioner (CT) Vs. The Indian Overseas Bank and another [2016 (12) TMI 373 - MADRAS HIGH COURT]. Thus, by applying the decision of the Full Bench referred above, the law having come into force, governs the parties even in respect of litigations which are pending. Therefore, the Income Tax Department cannot claim any precedence over the secured creditor in proceeding against the subject property for the recovery of the income tax arrears in the light of the law laid down by the Full Bench, which was rendered taking note of the recent enactment viz., the Enforcement of Security Interest and Recovery of Debts Laws and Miscellaneous Provisions (Amendment) Act, 2016. Writ Petition is allowed and the impugned order is quashed. The sixth respondent, viz., the Sub Registrar, Keelur, Tuticorin District is directed to delete the encumbrance which has been entered based upon the request made by the Tax Recovery Officer and the said direction be complied with, within a period of three weeks from the date of receipt of a copy of this order
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