Ajay Kumar And Others vs State Of Himachal Pradesh & Others
2021 Latest Caselaw 3572 HP

    IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA

                                            CWP No.132 of 2019
                                            Decided on: 05.08.2021




                                                                          .

    Ajay Kumar and others                                             ....Petitioners.
                   Versus
    State of Himachal Pradesh & others                                ...Respondents.





    Coram
    Hon'ble Mr. Justice Ajay Mohan Goel, Judge.
    Whether approved for reporting?1 No





    For the petitioners : Dr. Lalit Kumar Sharma, Advocate,
                          through Video Conferencing.
    For the respondents : Mr.Ajay Vaidya, Senior Additional
                     r    Advocate General, with Mr. Adarsh
                          Sharma, Additional Advocate General,

                          for respondents No.1to 4.
                          Mr. Vikrant Thakur, Advocate, for
                          respondent No.5, through Video
                          Conferencing.



                          Mr. Rajesh Kumar, Advocate, for
                          respondent No.6, through Video
                          Conferencing.




                          Mr. Sanjay Dalmia, Advocate, for
                          respondent No.7.





                          (Through Video Conferencing)
    Ajay Mohan Goel, Judge (Oral)

By way of this petition, the petitioners have prayed

for the following reliefs:-

Whether reporters of the local papers may be allowed to see the judgment?

"(i) a writ in the nature of mandamus directing the respondents No.1 to 3 to register the sale certificate dated 15.12.2018 (AnnexureP-4) issued by the Syndicate Bank, selling the property in question, in

.

favour of the petitioners, may kindly be issued;

(ii) a writ in the nature of mandamus directing the respondents No.1 to 3 to enter the names of the

petitioners as Owners of the property in question, in the revenue records, having been purchased by the petitioners in an auction conducted by a Syndicate Bank, under the provisions of the SARFAESI Act,

2002, may kindly be issued.

(iii) a writ in the nature of mandamus directing the respondents No.1 to 3 to remove the red entries

made in the revenue record/Jamabandi of the property in question due to alleged outstanding

amount of Central Excise Department, State Taxes and Excise Department and Electricity Board, may kindly be issued."

2. The facts are not in much dispute. M/s Raja

Forging and Gears Limited availed loan from Syndicate Bank.

On account of the inability of M/s Raja Forging and Gears

Limited to liquidate the same, proceedings stood initiated by

the bank against it under the provisions of SARFAESI Act,

2002. The auction of the property, subject matter of the writ

petition, was duly held by the Syndicate Bank and the

petitioner before this Court is the bidder whose bid was

accepted by the bank qua the sale of the properties in issue.

The Sale Certificate was in favour of the petitioner (Annexure

P-4) dated 15.12.2018. Thereafter, vide Annexure P-5, dated

.

15.12.2018, the bank approached the Sub-Registrar, Baddi,

District Solan, H.P. for registration of the certificate of the

sale under the SARFAESI Act in favour of the present

petitioner, which has been denied by the authority concerned

on the ground that there is a red entry in the revenue record

in favour of the Revenue. It appears that the loanee was owing

certain amount to the Revenue and on this count, in lieu of the

outstanding amount of the Excise and Taxation Department,

said entries stand incorporated in the revenue record in

favour of the State on the plea that State has first charge over

the said property.

3. Learned counsel for the petitioners has submitted

that the issue as to whether the first charge over the property

of the loanee would be that of the bank (from whom the

petitioners have purchased the properties in the auction) or

that of the Revenue, now stands decided by this Court in CWP

No.1638 of 2017, titled as Punjab National Bank and others

Versus State of Himachal Pradesh and Others, decided on

19.05.2021 and in view of the findings returned in the said

.

petition, this writ petition can also be disposed of by observing

that the said judgment shall mutas mutandi apply to this

petition also and as the first charge over the property in view

of the statutory provisions contained in the SARFAESI ACT,

2002 as well as Recover of Debts and Bankruptcy Act, 1993 is

that of the bank, a mandamus be issued to respondent No.4, to

register the Sale Certificate issued by the bank in favour of

the petitioner and also to register the Sale Deed.

4. The respondents have not disputed the factum of

the issue raised in the present petition being covered by the

judgment passed by this Court in CWP No.1638 of 2017, titled

as Punjab National Bank and others Versus State of

Himachal Pradesh and Others, decided on 19.05.2021.

However, learned Senior Additional Advocate General

submits that the petition be disposed of in terms of the above

judgment, but without prejudice to the legal rights of the

respondents/ State as the State intends to challenge the

judgment passed by this Court in CWP No.1638 of 2017, titled

as Punjab National Bank and others Versus State of

.

Himachal Pradesh and Others, decided on 19.05.2021

5. Having heard learned counsel for the parties and

after perusing the record of the present writ petition as also

the judgment passed by this Court in CWP No.1638 of 2017

(supra), as it has not been dispute by the State that the issue

involved in this writ petition is, in fact, covered by the

judgment, dated 19.05.2021, passed by this Court in Punjab

National Bank and another Vs. State of Himachal Pradesh

and others, CWP No.1638 of 2017, therefore, this writ petition

is allowed by holding that the findings returned in CWP

No.1638 of 2017 (supra) shall mutatis mutandis apply to this

petition.

6. To make it more clear, this writ petition is disposed

of by holding that the findings returned in CWP No. 1638 of

2017 (supra) shall mutatis mutandis apply

to this petition also and the Bank being "Secured Creditor",

has preference over the respondent-State with regard

to the debts due from the private respondent(s) and

the respondent-Department cannot claim first charge over

.

secured assets of the Bank, belonging to the loanee, as the

Bank has first charge over the secured

assets, in view of the provisions of the SARFAESI Act, 2002

and Recover of Debts and Bankruptcy Act,

1993, as amended from time to time. It is further held that the

provisions of Section 26 of the H.P. Vat Act, 2005 shall have to

give way to the provisions of Section 26E of the SARFAESI

Act, 2002 and Section 31B of the RDB Act, 1993.

7. As a consequence thereof, respondent No.3 is

directed to register the Sale Certificate, dated 15.05.2018,

issued in favour of the petitioner by the Syndicate Bank and

also register the Sale Deed between the petitioners and the

bank qua the property subject matter of the writ petition.

8. It is clarified that the rigors of the SARFAESI

ACT, 2002 with regard to the period within which the sale

proceedings are to be completed shall not apply to the case i.e.

to say that the time which has been spent by the parties in the

Court, shall be excluded while computing the same. Petition

stands disposed of, so also pending miscellaneous applications,

.

if any.

                                            (Ajay Mohan Goel)





                                                  Judge
    August 05, 2021
       (Rishi)



                  r         to