ValkyaEditorial

Tagged “tax-priority”

1 article on tax-priority.

Landmark JudgmentSupreme Court of India

Central Bank of India v. State of Kerala: Crown debt priority, the silent non-obstante, and the 2016 statutory reversal

On 27 February 2009 a three-judge Constitution Bench of the Supreme Court held that neither the RDDBFI Act 1993 nor the SARFAESI Act 2002 contained any express provision giving the secured creditor priority over the State's statutory first charge for sales-tax or excise dues. The non-obstante clauses in Section 34(1) RDDBFI and Section 35 SARFAESI did not, by implication, displace specific statutory first charges in State revenue legislation. The State's first charge prevailed. The decision drove the 2016 Amendment Act, which inserted Section 31B RDDBFI and Section 26E SARFAESI and reversed the priority position for registered secured creditors prospectively.

Valkya Editorial··15 min