TMI Blog2018 (12) TMI 146X X X X Extracts X X X X X X X X Extracts X X X X ..... crown debt is treated as unsecured and mortgage rights will get priority only when the statute does not create a charge under the Act. It is also settled that the non obstante clauses of the Tamil Nadu General Sales Tax Act, 1959, and the SARFESAI Act are not at conflict with each other as both the statutes can be given effect harmoniously through purposive interpretation. Accordingly, those statutes under which a charge is created on the assets will have priority over mortgage rights under any other Act. And those statutes where charges are not created will be accorded a status of unsecured debts and will have low priority over the secured creditors under the SARFESAI Act - The Tamil Nadu General Sales Tax Act, 1959, having created char ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the property including the one comprised in S.Nos. 1318/1 1319/1 were brought for sale by auction notification dated 21.09.2015 published in a leading daily for a realisation of ₹ 46,97,272/-. 2.1. While the matter stood thus, the petitioners participated in the auction conducted by the bank and they were declared as highest bidder and a Sale Certificate was issued and it was executed on 29.03.2007. In such circumstances, the respondent herein issued a notice in his impugned proceedings dated 02.02.2012 calling upon to pay a sum of ₹ 4,31,400/- with interest being the due to the respondent by the defaulter, namely, M/s.Ravishankar Fire Works Factory, Sivakasi. In the said notice, it is stated that in the event of failure t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ties with factory shed thereon by issue of demand notice in 'Form No.4' of the Tamil Nadu Revenue Recovery Act, 1864 and was served on the partner one G.Ravindran on 17.04.2002. Further, 'Form No.5' notice dated 05.12.2003 was issued under the Revenue Recovery Act was also published in the Virudhunagar District Gazette dated 26.01.2004 besides wide publicity was circulated to Revenue, Registration and other department officials. It is also averred that the statutory notices were issued with Form B-6 dated 01.11.2001 along with the letter, prescribed under the Tamil Nadu General Sales Tax Act 59, to some of the locally functioning nationalised banks, namely, Indian Overseas Bank, Tamil Nadu Mercantile Bank and State Bank of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2 filed against the issue of reminder notice dated 28.03.2012. It is also averred that the buyers/petitioners seem to have full knowledge of the Government dues and the auction sale by the Indian Overseas Bank was circulated vide its newspaper advertisement dated 20.09.2005 and item No.8 of the terms and conditions annexed thereon, indicates the obligation of the buyers to settle the dues payable to Government Departments, Electricity and Local bodies. Hence, the petitioners are duty bound to pay the amount in question to the respondent and the Writ Petitions are liable to be dismissed. 4. Learned counsel for the petitioners would contend that the impugned notice is purportedly issued under Section 24 of the Tamil Nadu General Sales Tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the writ petition. 6. Heard the learned counsel for the petitioners and the learned counsel for the respondent. 7. The question of who holds first charge as to whether the crown debt / the revenue to the government under the fiscal laws or the claim of secured creditors under SARFESAI Act is laid to rest by the decision of the Hon'ble Supreme Court in the case of Central Bank of India vs. State of Kerala Others in Civil Appeal No.95 of 2005 dated 27.02.2009 . Accordingly, the statutory charge prevail over mortgage charge over any pledged property. The crown debt is treated as unsecured and mortgage rights will get priority only when the statute does not create a charge under the Act. 8. It is also settled that the non o ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
