JUDGMENT :

SANDEEP N. BHATT, J.

1. The petitioner is before this Court seeking quashment of the charge or mortgage on the property in question by the Central Sales Tax Department in the Revenue Department and further seeking direction against the Revenue Authority to register and release the sale deed No.1533 of 2022 dated 24.06.2022 and further by holding that the petitioner is the absolute owner of the property in question with legal and valid title as once purchased under the public e-auction.

2. The brief facts of the case are epitomized as under :

2.1 The property in question, being a ‘secured asset’, was put for the public e-auction by the respondent No.5 – State Bank of India due to the default committed by the borrower/mortgagor, after taking the possession of the property, under the SARFAESI Act.

2.2 The petitioner purchased the said property in the said public e-auction conducted by respondent No.5 – Bank on 16.12.2021 for a sale consideration of Rs.1,45,01,000/- and the Bank issued a sale certificate in favour of the petitioner.

2.3 Thereafter, on 24.06.2022, the sale deed was executed in favour of the petitioner and the possession was handed over to the petitioner, free from all encumbrances by respondent – Bank.

2.4 After the execution of the sale deed, the petitioner came to know that respondent No.1 – the Central Sales Tax Department created charge over the property for the recovery of the dues. Therefore, the Revenue Authority – Sub- Registrar, Sihor has sent a letter dated 24.06.2022 to the petitioner that he shall not release the sale deed unless the petitioner resolve the issue related to sales tax.

2.5 Therefore, the petitioner, by way of this petition, seeks to hold that he is the absolute owner of the property in question with legal and valid title and a bona fide purchaser; and further seeks direction against the revenue authority to release the sale deed No.1533 of 2022 dated 24.06.2022 and not to take any adverse action; and further seeks direction against the respondent No.1 for releasing the charge created by them.

3. Heard learned advocate Mr.B.C. Thakkar for the petitioner, learned AGP Mr.Trupesh Kathiriya for respondent Nos.1 to 3 – State Authorities and learned advocate Ms.Dharmishta Raval for respondent No.5 – State Bank of India. Rule. Learned advocates waive service of notice of rule on behalf of the respective respondents.

4.1 Learned advocate for the petitioner has submitted that the petitioner has purchased the subject property in public e-auction conducted by respondent No.5 – State Bank of India. He has submitted that the erstwhile owner/mortgagor and or respondent No.1 authority had not created security interest over the property in question before the revenue authority.

4.2 He has further submitted that the petitioner is the absolute owner of the property once purchased under public auction and cannot be held liable for any unpaid dues of either parties. The priority created under Section 35 of the SARFAESI Act shall have overriding effect on all other laws. He has submitted that the priority has been given for the recovery of bank dues by way of enactment of central legislation. The State tax dues shall not have priority over the debt of the bank.

4.3 In support of this submissions, he has relied upon the decision rendered by this Court in case of Kalupur Commercial Cooperative Bank V/s State of Gujarat recorded on Special Civil Application No.17891 of 2018 dated 23.9.2019 and has submitted that the issue is no more res integra.

4.4 He has also relied upon the following decisions:

(i) Special Civil Application No.12995 of 2018 – Bank of Baroda versus State of Gujarat

(ii) Special Civil Application No.17891 of 2018 – Kalupur Commercial Co-operative Bank Ltd., versus State of Gujarat

(iii) Writ Petition No.4063 of 2019 – State Bank of India versus The Deputy Commercial Tax, dated 18.02.2021 – High C