State Tax First Charge Prevails Over SARFAESI Section 26E Priority: Karnataka HC

Advertisement Omkara Assets Reconstruction Private Limited Vs Official Liquidator of M/S. BPL Engineering Limited (Karnataka High Court) Statutory First Charge under State Tax Laws prevailed over SARFAESI priority despite CERSAI Registration Conclusion: Registration of security interest with CERSAI under Sections 26C and 26E of the SARFAESI Act did not override a statutory first charge created under the APGST Act, APVAT Act, or applicable for recovery of CST dues. Section 26E conferred only priority of payment and operateds prospectively, without displacing statutory first charge...