Central Bank Of India vs Office Of State Tax Officer
2026 Latest Caselaw 1273 Bom

Bombay High Court

Central Bank Of India vs Office Of State Tax Officer on 4 February, 2026

Author: Manish Pitale

Bench: Manish Pitale

  2026:BHC-OS:3357-DB                                                                   911-WPL-41914-2025.DOC



                                   IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                                       ORDINARY ORIGINAL CIVIL JURISDICTION

                                           WRIT PETITION (L) NO. 41914 OF 2025

                       Central Bank of India                                         ...Petitioner
                              Versus
                       Office of State Tax Officer                                   ...Respondent

                                                      _______
                       Ms. Savita Nangare, a/w Mr. Vinod Nagula, a/w Mr. Anurag Satam,
                       i/b Law Focus, for the Petitioner.
          Digitally
          signed by
          VARSHA
                       Mr. Himanshu Takke, AGP for State/Respondent Nos. 1 and 2.
VARSHA    DEEPAK
DEEPAK    GAIKWAD                                     _______
GAIKWAD   Date:
          2026.02.04
          19:48:23
          +0530
                                                             CORAM:       MANISH PITALE &
                                                                          SHREERAM V. SHIRSAT, JJ.

                                                             DATE:        4TH FEBRUARY 2026
                       P.C.

1. In this petition on 27th January 2026, this Court had passed the following order:

"1. Heard learned counsel for the Petitioner-Bank.

2. It is contended on behalf of the Petitioner-Bank that in the light of the law laid down by the full bench judgment of this Court in the case of "Jalgaon Janta Sahakari Bank Ltd. & Anr. vs. Joint Commissioner of Sales Tax Nodal 9, Mumbai, & Anr."1, the dues of the Petitioner-Bank have priority over the dues of the Respondent No. 1 i.e. Sales Tax Officer.

3. In support of the aforesaid contention, it is brought to the notice of this Court that the security

1(2022) 5 MHLJ 691

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911-WPL-41914-2025.DOC

interest of the Petitioner was registered in the Central Registry of Securitisation Asset Reconstruction and Security Interest of India (CERSAI) as far back as on 13/09/2012.

4. Issue notice to the Respondents for final disposal, returnable on 4th February 2026, to be included in the Supplementary Board.

5. Learned AGP waives notice on behalf of the Respondents."

2. The learned AGP represents the respondents. During the course of the arguments, the learned AGP was unable to distinguish the present case from the cases considered by a Full Bench of this Court in the aforesaid mentioned judgment in the case of Jalgaon Janta Sahakari Bank Ltd. & Anr. vs. Joint Commissioner of Sales Tax Nodal 9, Mumbai, & Anr. (supra). We find that in Paragraph 85 of the said Full Bench judgment, the following conclusion has been recorded:

"85. Priority means precedence or going before (Black's Law Dictionary). In the present context, it would mean the right to enforce a claim in preference to others. In view of the splurge of "first charge" used in multiple legislation, Parliament advisedly used the word "priority over all other dues" in the SARFAESI Act to obviate any confusion as to inter se distribution of proceeds received from sale of properties of the borrower/dealer. If a secured asset has been disposed of by sale by taking recourse to the Security Interest (Enforcement)

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Rules, 2002 it would appear to be reasonable to hold, particularly having regard to the non obstante clauses in sections 31B and section 26E, that the dues of the secured creditor shall have "priority"

over all other including all revenues, taxes, cesses and other rates payable to the Central Government or State Government or local authority."

3. In the present case, there is no dispute on facts. The security interest of the petitioner- bank was duly registered with the Central Registry of Securitisation Asset Reconstruction and Security Interest of India (CERSAI) on 13th September 2012. Exhibit E clearly specifies the said date and there is no dispute about it. The order of attachment at Exhibit E issued by the Sales Tax Officer of the respondent State is dated 26th March 2024, which is much after the CERSAI registration in favour of the petitioner. In view of the said admitted facts, the interest of the petitioner bank, which is a secured creditor, has priority over the claims made by the respondents towards tax dues concerning the secured asset. The Full Bench judgment of this Court squarely applies to the facts of the present case and therefore, the petition deserves to be allowed and the impugned order of attachment deserves to be set aside.

4. In view of the above, the writ petition is allowed in terms of prayer Clause (a) which reads as follows:

"(a) This Hon'ble Court be pleased to issue writ of Mandamus and/or Certiorari and/or any writ in the nature of Mandamus and/or Certiorari and or any appropiate writ, order or direction to quash and set aside the Impugned Order dated 26th March 2024

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of the Respondent No.1 in respect of the secured Asset."

5. The respondents shall take consequential steps of correcting the revenue records at the earliest and in any case, within two weeks from today.

6. Pending applications, if any, also stand dismissed.

(SHREERAM V. SHIRSAT, J.) (MANISH PITALE, J.)

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