T.S. Krishnamoorthy Iyer, J.

1. I heard counsel for the Official Liquidator, counsel appearing for the auction-purchaser, counsel appearing for the Kozhikode Corporation and the counsel appearing for the applicant on the claim for priority regarding the property tax due to the Kozhikode Corporation. The claim for priority for the entire arrears of tax by the Kozhikode Corporation is based on section 105 of the Calicut City Municipal Act. 1961. Section 105 of that Act reads:

"The property tax on building and lands shall, subject to the prior payment, of the land revenue if any, due to the Government thereon, be a first charge upon the said buildings or lands and upon the movable property, if any, found within or upon such buildings or lands and belonging to the person liable to such tax."

If the section alone were applicable in the case, the claim, for priority by the Corporation has only to be accepted. But section 530 of the Companies Act, 1956 reads:

"530(1). In a winding up, there shall be paid in priority to all other debts

(a) all revenues, taxes, cesses and rates due from the company to the Central or a State Government or to a local authority at the relevant date as defined in clause (c) of sub-section (8) and having become due and payable within the twelve months next before that date."

The rest of the section is not very material except section 530 clause (8) (c) which gives the meaning of the expression "the relevant date". Since there is no dispute between the parties as to the scope of the expression (relevant date) I am not extracting that provision. If section 530 of the Companies Act, 1956 is to govern this case in preference to section 105 of the Calicut City Municipal Act, 1961, then the claim for priority will have to be restricted to the amount that became due and payable before the relevant date referred to in that section. The parties are agreed that on the basis of section 530 of the Companies Act, 1956 the preferential payment has to be limited to the sum of Rs. 1,060.86, which represents the tax due for the years 1961-62 and 1963-64. The winding up order is dated 22nd December 1963. It is not necessary to discuss this matter any further in view of the decision in In re Kerala Water Transport Corporation Ltd., 1967 K.L.T. 358 in which this principle has been accepted following the decision of the Federal Court in Governor-General in Council v. Shiromani Sugar Mills Limited (In Liquidation), A.I.R. 1946 F.C. 16. But counsel on behalf of the secured creditor contended that even in respect of the sum of Rs. 1060.86 the Calicut Corporation can claim priority only over the other insecured creditors and cannot claim priority over secured creditors. If there was no winding up, section 105 of the Calicut City Municipal Act, 1961 will prevail and as per that provision it is open to the Corporation to claim priority even as against a secured creditor. It is not contended nor would it be possible to contend that by the terms of section 105 of the Calicut City Municipal Act the priority for the amounts referred to in that section will have to be confined among the insecured creditors.

2. Counsel on behalf of the secured creditor relied on the ruling in Income-tax Officer, Ernakulam v. Indian Traders Bank Ltd. (In Liquidation), 1969 K.L.T. 596. I do not think that decision can render any assistance in resolving the present controversy. The declaration of prior charge by section 105 of Act 30 of 1961 in respect of the amount referred to in section 530 (1) (a) is not inconsistent with that provision and in the matter of preferential payment in respect of the amount which will come within the ambit of section 530 (1) it is open to he Calicut Corporation to claim priority under section 105 of Act 30 of 1961. I therefore overrule the plea of the secured creditor that no priority as against him can be claimed by the Calicut Corporation in respect of R 1,060.86. I do not find anything in section 446 (4) of the Companies Act