Manimuth Humanitarian Service Trust vs The Inspector General Of Registration on 1 October, 2018
3.The learned Counsel appearing for the petitioner would submit that
during the pendency of the proceedings before the Debts Recovery Tribunal,
Coimbatore, the Superintendent of Central Excise, the second respondent
herein, also created a charge over the same property and the entry in the
book of Sub Registrar, Kinathukadavu, the third respondent has been made for
a sum of Rs.3,08,62,435/- on 29.12.2014 vide document No.27/2014. Since the
said charge was created after six years and five months from the date of
award passed by the Debts Recovery Tribunal, Coimbatore, i.e., on 16.05.2008,
the rights of the secured creditor to realise the security debts due and
payable by sale of assets over which security interest is created, shall have
priority over all debts and Government dues including revenues, taxes, cesses
and rates due to the Central Government, State Government or Local Authority,
as per the ratio laid down by the Full Bench of this Court reported in
2007(1) LW 500 (UTI Bank vs. Commercial Tax). The learned Counsel for the
petitioner would further submit that when the petitioner has purchased the
property in a public auction on 02.05.2017 brought by the Canara Bank, the
fourth respondent herein, for realising the loan amount against the borrower,
who has committed default and subsequently, their account was classified as
Non-Performing Asset, the further charge created by the Superintendent of
Central Excise, Pollachi, on 29.12.2014 is without any jurisdiction.
Referring to Section 31-B of the Enforcement of Security Interest and
Recovery of Debts Laws and Miscellaneous Provisions (Amendment) Act, 2016,
the learned Counsel for the petitioner would further contend that Section 31-
B of the Act 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.