Topic
Under Indian law, secured creditor priority determines the order in which creditors with registered security interests are paid from the proceeds of collateral, especially under the SARFAESI Act and CERSAI registration rules.
Bombay HC rules that secured creditors under SARFAESI Act retain priority over tax dues if tax authorities fail to register their charge with CERSAI, affirming banks' rights in asset recovery disputes. Decision applies even to pre-2020 tax attachments, citing Jalgaon Janta Sahakari Bank precedent.
The Andhra Pradesh High Court has ruled that a secured creditor’s prior registered mortgage takes precedence over a later civil court attachment, compelling registration of the SARFAESI sale certificate regardless of the property’s inclusion in a prohibited list. This reinforces the supremacy of secured interests under the SARFAESI Act and clarifies that administrative restrictions cannot override statutory priority rights of financial institutions.
The Bombay High Court has ruled that a secured creditor who registered its interest with CERSAI before GST dues arose is entitled to priority over tax claims, even when the asset is sold via private treaty after failed auctions. This clarifies that GST authorities cannot impose charges on property already encumbered under SARFAESI, reinforcing the enforceability of secured lending rights in distressed asset recovery.
Bombay High Court rules that secured creditors under the SARFAESI Act hold priority over state tax dues arising after 20 January 2020, reinforcing CERSAI registration as the determining factor. The judgment clarifies that post-amendment tax claims do not override secured interests, impacting insolvency and recovery proceedings for banks and financial institutions.
Bombay High Court holds that secured creditors with prior CERSAI registration enjoy priority over state tax claims, reinforcing SARFAESI Act's non-obstante clause.
Bombay High Court holds that secured creditors with prior CERSAI registration enjoy priority over state tax dues under SARFAESI Act, reinforcing statutory supremacy of secured interests.