Recovery of Debts and Bankruptcy Act 1993

Priority Of Dues Under SARFAESI - Bombay High Court Reiterates

In a significant order passed on June 28, 2023, in the case of Ronak Industries vs. Assistant Commissioner Central Excise & Customs & Ors.[1] (“Ronak Industries Case”), the Bombay High Court has upheld the priority of dues of secured creditors as laid down under Section 26-E of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (“SARFAESI Act”). To pass the order, the Bombay High Court has relied on its previous decision in Jalgaon Janta Sahakari Bank Ltd. and Anr. Vs Joint Commissioner of Sales Tax Nodal 9, Mumbai and Anr.[2] and the decision of the Supreme Court in  ICICI Bank Ltd. vs. SIDCO Leathers Ltd.[3]and held that the dues of a secured creditor, upon registration of the charge with the Central Registry of Securitisation Asset Reconstruction and Security Interest of India (“CERSAI”), would rank in priority to the dues of the department of the Government.Continue Reading Priority Of Dues Under SARFAESI: Bombay High Court Reiterates