The main legal point established in the judgment is the priority claim of a secured creditor over statutory dues, as recognized under Section 529A of the Companies Act, 1956, and Section 26E of the SARFAESI Act.

R.M. BORDE, J.

1. The petitioner Axis bank Ltd., is seeking quashment of the notices dated 12th August, 2013 and 19th September, 2013 issued by Respondent No. 1/Assistant Commissioner of Sales Tax, (Investigation) (D-001), Thane City Division Thane. The petitioner is also aggrieved by the notice in Form No. 318 under section 33 (1) of the Maharashtra Value Added Tax Act, 2002 issued by the Assistant Commissioner of Sales Tax as well as the consequential communication issued by the Reserve Bank of India on 12th February, 2015.

2. According to the petitioner, one M/s. Jay Mechanical Pvt. Ltd., (represented by the Official Liquidator, in the instant petition as respondent No. 2), approached the petitioner in the year 2008 with a request to extend financial assistance. The petitioner bank extended the financial assistance to the respondent No. 2 - Company and in order to secure the finances the Company mortgaged its immovable property as well as hypothecated its assets in favour of petitioner-bank. The respondent No. 1 Company defaulted in making repayment of the loan. As such the petitioner-bank was constrained to initiate action for recovery of dues.

3. The petitioner bank through its authorised officer issued notice under section 13 (2) on 6th June, 2011 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (54 of 2002) (for short, SARFAESI Act, 2002) calling upon the Company to repay an amount of Rs. 4,30,51,432.51 ps within a period of 60 days from the date of the notice. In addition to the initiation of proceedings under the provisions of SARFAESI Act, 2002, the Bank has also presented proceedings before the Debt Recovery Tribunal (DRT) under Section 19 of the Recovery of Debts due to Banks Act, 1993 (for short, "RDDB Act,1993"). The amount claimed in the Original Application No. 464 of 2013 by the petitioner Bank as against the Respondent No. 2 Company is to the tune of Rs. 2,81,43,918.17 ps.

4. The Company failed to honour the demand notice dated 6th June, 2011 issued under section 13(2) of the SARFAESI Act and as such the petitioner bank took possession of the secured assets on 5th December, 2011. The petitioner through its Authorised Officer published the possession notice dated 5th December, 2011 in two news papers on 23rd December, 2011. The petitioner received a copy of the Prohibitory Order issued by respondent No. 1 to Respondent No. 2 Company under Section 38 of the Maharashtra Value Added Tax Act, 2002 (for short, MVAT Act, 2002) restraining it from transferring and/or alienating any of the assets of the Company. There was no demand made by Respondent No. 1 in respect of the taxes in the notice.

5. Petitioner No. 1 through its authorised officer took over physical possession of the property and thereafter in observance of the SARFAESI Act, said property was put to public auction and sale under sale notices dated 19th and 20th June, 2012. The auction sale was conducted on 8th February, 2013 and one M/s Vinals Precisions Pvt. Ltd., being the highest bidder for an amount of Rs. 3,25,25,000/-the property was sold in its favour. A sale certificate came to be issued on 18th March, 2013 in favour of the auction purchaser.

6. The petitioner thereafter on 22nd July, 2013 received a notice under Section 38 of the MVAT Act, 2002 issued to Respondent No. 2 Company a copy of which was marked to the petitioner calling upon the petitioner to intimate respondent No. 1 about transfer undertaken by the said Company. The petitioner received two notices issued by respondent No. 1 on 12th August, 2013 and 19th September, 2013 respectively calling upon the petitioner to deposit an amount of Rs.46,49,317/- with the respondent No. 1.

7. The petitioner contends that the petitioner bank being a secured creditor has preferential claim over the secured assets and is entitled to take appropriate steps for realization of the amount due and recoverable from Respondent No. 2 Company. The p