9911796707
TMI Blog2013 (8) TMI 195X X X X Extracts X X X X X X X X Extracts X X X X ..... thereof, situate at Sy. No.32/2A of Bangra Kulur Village, Mangalore. By way of further security, the said borrower created equitable mortgage over free hold rights in three shops measuring about, 325 Sq. feet; 115 Sq. feet and; 535 Sq. feet, respectively, in all, measuring 975 Sq. feet, with common facilities, in the building on land bearing Sy. No.32/2A, Bangra Kulur Village, Mangalore. The additional loan of Rs.86,00,000/- when sanctioned, Rs.76.33 lakhs was released during the year 1998, for which, the building measuring 2110 Sq. feet on the first floor of the building on Sy. No.32/2A of Bangra Kulur Village, was offered as security by way of equitable mortgage by deposit of title, under the agreement dated 28.04.1998. 2. The borrower, having failed to repay the amount due together with interest led the petitioner to invoke Section 29 of the SFC Act and took over possession of the properties, mortgaged and furnished as security. Though the petitioner took possession of the mortgaged properties, nevertheless, the borrower committed default in the payment of the amounts due. 3. On 05.12.2000, the Tax Recovery Officer, Mangalore Range - second respondent passed an order attachin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... achment, the Income-tax department and hence a priority charge in the matter of recovery of debts as indicated in the letter dated 14th July 2011 Annexure 'J'. 7. Hence, this petition for the following reliefs: "a) issue a Writ of Mandamus directing the Respondents to lift the attachment in respect of Properties bearing No.32/2A, Bangra Kulur Village, Mangalore. b) issue a Writ of Mandamus restraining the Respondents from interfering in sale of the aforesaid properties and appropriate the proceeds towards amounts due to it. c) issue a Writ of Mandamus restraining the respondents from selling the aforesaid properties and appropriate the proceeds towards arrears of tax due from Sri Vivian Kamath D'Souza, M/s. Veekay Developers Pvt. Ltd., M/s. Shalimar Constructions and M/s. Canara Builders. d) issue such other writ, order or direction the Court may deem fit in the facts and circumstances of the case. e) Grant such other relief as the Court may deem fit in the above case and cost in the interest of justice and equity." 8. Having heard the learned counsel for the parties, perused the pleadings and the statutory pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat arose for decision making in that case was: "Whether Section 38-C of the Bombay Sales Tax Act, 1959 (the Bombay Act) and Section 26-B of the Kerala General Sales Tax Act, 1963 (the Kerala Act) and similar provisions contained in other State legislations by which a first charge was created on the property of the dealer or such other person, who was liable to pay sales tax, etc. were inconsistent with the provisions contained in the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (the DRT Act) for recovery of "debt" and the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (the Securitisation Act) for enforcement of "security interest" and whether by virtue of non obstante clauses contained in Section 34(1) of the DRT Act and Section 35 of the Securitisation Act, the two Central legislations had primacy over State legislations?" 12. The facts therein were that the borrower, who mortgaged his properties to the creditor Bank failed to repay the dues and therefore, the Bank instituted a suit, which when decreed by the Debts Recovery Tribunal, a recovery certificate issued in favour of the Bank, and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and other secured creditors should have priority over the State's statutory first charge in the matter of recovery of the dues of sales tax, etc. There being no provision incorporated either in the DRT Act or Securitisation Act, it was held that it was not possible to read any conflict or inconsistency or overlapping between the provisions of the DRT Act and the Securitisation Act, on the one hand, and Section 38-C of the Bombay Act and Section 26-B of the Kerala Act, on the other, and the non obstante clauses contained in Section 34(1) of the DRT Act and Section 35 of the Securitisation Act cannot be invoked for declaring that the first charge created under the State legislation would not operate qua or affect the proceedings initiated by banks, financial institutions and other secured creditors for recovery of their dues or enforcement of security interest, as the case might be. 13. As a matter of fact, at paragraph 172 of the judgment in Central Bank of India's case, Apex Court extracted its earlier judgment in State Bank of Bikaner and Jaipur Vs. National Iron and Steel Rolling Corpn. (1995) 2 SCC 19, wherein it was observed that the first charge created under Section 11-AAAA ..... X X X X Extracts X X X X X X X X Extracts X X X X
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