ORAL JUDGMENT :- Rule.

2. Pursuant to an order passed by this Court in certain Company petitions, the Official Liquidator was appointed as Liquidator in respect of the business and assets of a Company known as Jayanti Business Machines Ltd. The Official Liquidator is stated to have been in physical possession of the movable and immovable property of the Company. Bank of India was a secured creditor with a claim in excess of Rs. 30.39 crores. By an order dated 27th January, 2005, certain directions were issued by the Learned Company Judge. Bank of India initiated recovery proceedings before the Debts Recovery Tribunal for the recovery of its dues. The Debts Recovery Tribunal ordered that the property of the Company be put to auction and an auction sale was held in pursuance of a public notice and the petitioners were declared as successful purchasers at an auction that was held on 10th May, 2006 at and for a consideration of Rs. 2.77 crores. The petitioners are stated to have paid the sale price and possession of the property was handed over by the Official Liquidator under the directions of the Debts Recovery Tribunal on 17th July, 2006. The Municipal Corporation addressed a communication to the petitioners on 2nd August, 2006 through the Assistant Assessor and Collector, K/E Ward demanding arrears on account of property taxes in the amount of Rs. 89.63 lakhs together with a penalty in the amount of Rs. 1.50 lakhs. That led to the institution of these proceedings under Article 226 of the Constitution.

3. At the hearing of the petition, counsel appearing on behalf of the petitioners has relied upon the judgment of a learned Single Judge of this Court, Hon'ble Mr. Justice F. I. Rebello, delivered on 16th September, 2005 in Anchor Health and Beauty Care Ltd. vs. Municipal Corporation of Greater Mumbai, Writ Petition 1340 of 2005 [since reported in 2006(1) Mh.L.J. 619]. In the case, which arose before the learned Single Judge, an Official Liquidator was appointed as Liquidator of the properties of a Company which was in liquidation. An auction was conducted by the Liquidator at which the first petitioner before the Court came to be declared as successful purchaser. After the property had thus vested in the auction purchaser, the Municipal Corporation issued a warrant of attachment on account of non-payment of property taxes between the period 1st October, 1989 to 31st March, 2003, this being a period prior to the date of the purchase by the successful bidder. In a challenge which was preferred on behalf of the auction purchaser, the Municipal Corporation asserted that under section 212 of the Bombay Municipal Corporation Act, 1888, property taxes due in respect of any building or land are a first charge upon the interest in such land or building of the person liable for such taxes. The learned Single Judge, however, held that section 212 of the Act was of no assistance, relying on the provisions of sections 456, 457, 528, 529 and 530 of the Companies' Act, 1956. The Court held that the Municipal Corporation is not a secured creditor who can stand outside the winding up and would have to file its claim before the Liquidator. Hence, the conclusion that was arrived at was that the purchaser of the property put to an auction sale by the Liquidator of the Company in winding up was not liable to pay taxes prior to its purchase and claims in respect of the period prior to the date of purchase would have to be filed before the Liquidator who would consider the priority of those claims in accordance with law.

4. On behalf of the Municipal Corporation, it has been submitted that the judgment of the learned Single Judge would require reconsideration inasmuch as it overlooked the plain intendment of the provisions of section 212 of the Bombay Municipal Corporation Act, 1888. Moreover, it is submitted that a provision, which is pari materia, has been interpreted by the Supreme Court in the context of an appeal, which arose against a demand mad

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