Point of Law : Section 26 of HPVAT creates first charge on property of dealer or such other person from whom any amount of tax or penalty including interest is recoverable.

ORDER :

1. Petitioners herein are purchasers of property in reference for consideration of Rs.3,71,50,000/- in an E-auction conducted by respondent No. 5-Bank in proceedings under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (in short SARFAESI Act) for default in payment of Loan Cash Credit etc. by previous owner of property M/s Dev Bhumi Ispat.

2. Respondent No. 5-Bank has issued Sale Certificate in favour of petitioners, but respondents No. 1 and 2, for the charge recorded in revenue record in favour of respondent No. 3 H.P. State Electricity Board for outstanding electricity bill and respondent No. 4- State Excise and Taxation Department for outstanding taxes declared as arrears of land revenue, are not permitting the petitioners and respondent No. 5 to execute the sale deed after removing the charges recorded in favour of respondents No. 3 and 4 and treating the property in question free from all encumbrances. Therefore, petitioners have approached this Court with following main reliefs:-

1. That respondent No. 2 may kindly be directed to grant the permission to the petitioners to get the sale deed executed and registered in view of Annexure P-1, certificate of sale and decide Annexure P-5, within the time bound period.

2. That respondent No. 2 may kindly be directed to sanction/attest the mutation of the property purchased by the petitioners in an auction in their favour.

3. That respondent No. 2 may kindly be directed to remove the entries/note made in the revenue record in favour of respondents No. 3 and 4 within time bound period, as requested in Annexure P-5.

3. Undisputed facts, in present case, are that one M/s Dev Bhumi Ispact had availed financial assistance i.e. Cash Credit and Term Loan from respondent No. 5 by keeping the property in question as a secured assets with respondent No. 5-Bank by creating a lien/charge over the property and a corresponding entry in the revenue record was made by Report No. 401 dated 14.5.2010. For nonpayment/ re-payment of cash credit and term loans by M/s Dev Bhumi Ispat, respondent No. 5-Bank had invoked provisions of SARFAESI Act and Security Interest (Enforcement) Rules, 2002 and in furtherance thereto, had advertised public notice for E-auction of suit property in newspaper dated 12.7.2019 proposing E-auction on 30.7.2019. In E-auction, petitioners were confirmed as highest bidders and to this effect, respondent No. 5-Bank had issued Certificate of Confirmation of Sale of property under SARFAESI Act, 2002 vide communication/ certificate dated 2.8.2019 (Annexure P-3). Thereafter, on depositing sale amount of Rs.3,71,50,000/- including TDS amount, Sale Certificate dated 4.11.2019 (Annexure P-1) was issued by Authorized Officer. In sequel thereto, possession of suit property was handed over to petitioners and a certificate of handing and taking over the possession was issued on 5.11.2019.

4. It is also on record that vide Report No. 745 dated 8.8.2014, an entry was made in revenue record creating charge in favour of H.P. State Electricity Board for non-payment of Electricity Bill amounting to Rs.7,80,725/- by M/s Dev Bhumi Ispact. Thereafter, another entry was made in revenue record creating charge, vide Report No. 190 dated 10.12.2014, in favour of Collector-cum-Assistant Excise and Taxation Commissioner, BBN, Baddi for recovery of unpaid taxes amounting to Rs.7,53,17,197/- which has been declared as arrears of land revenue.

5. In aforesaid circumstances, petitioners intend to execute and register the sale deed and attestation of mutation thereof accordingly for updating the revenue entry, but with removal of charges created in favour of respondents No. 3 and 4 from revenue entries recorded vide Rapat Nos. 745 and 190. For denial thereof by respondents No. 1 to 4, petitioners have approached this Court.

6. According to petitioners as well as respondent No. 5-Bank, on the suit property M/s Dev Bhumi Ispact has created security int