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2018 (10) TMI 969 - HC - Central ExciseAttachment of property - Recovery of dues - same property was already attached by bank against Non-performing Assets - Whether the Financial Institution, which is a secured creditor, or the department of the Government concerned, would have the 'Priority of Charge' over the mortgaged property in question, with regard to the tax and other dues? - Held that:- Section 31-B of the Enforcement of Security Interest and Recovery of Debts Laws and Miscellaneous Provisions (Amendment) Act, 2016 clearly makes the issue raised between the petitioner and the second respondent clear that the rights of the secured creditors to realise secured debts due and payable to them by sale of assets over which the security interest is created, shall have priority and shall be paid in priority over all other debts and Government dues including revenues, taxes, cesses and rates due to the Central Government, State Government or local authority - decided in favour of the financial institution, which is a secured creditor having the benefit of the mortgaged property. What are the status and the rights of a third party purchaser of the mortgaged property in question? - Held that:- The question is stated to relate only to auction sales, which may be carried out in pursuance to the rights exercised by the secured creditor having a mortgage of the property. This aspect is also covered by the introduction of Section 31B, as it includes “secured debts due and payable to them by sale of assets over which security interest is created.” The petitioner being a bona fide purchaser has purchased the property brought by the bank in public auction held on 02.05.2017. Moreover, the crucial aspect to be borne by us is the date of attachment of the property in question by the bank on 22.07.2008 - When the property in question was already attached by the fourth respondent bank after classifying the account of the original borrower as Non-Performing Asset and subsequently the property was also attached on 22.07.2008, almost six years ago, the property in question has disappeared from the scope of attachment to be made by the second respondent, the reason being that the charge was created only on 22.12.2014. The Sub Registrar, Kinathukadavu, Coimbatore District, third respondent herein, is directed to remove all the entries made in respect of Survey No.80/2, Nallatipalayam Village, Kinathukadavu Taluk, in favour of the second respondent by document No.27/2014, dated 29.12.2014 - petition allowed.
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