SARFAESI--Secured Assets--Proceedings under the SARFAESI Act would hold primacy over any other Legislature attaching the property
SARFAESI--Secured Creditor--Right of a secured creditor to realise a secured debt shall have priority over all debts and government dues including revenues, taxes, cesses and rates due to the Central Government, State Government or Local Authority

MANJARI NEHRU KAUL, J.

1. This order shall dispose of the abovesaid two writ petitions as the issue involved in both the writ petitions is the same. The brief facts of the case are being extracted from CWP No.12188 of 2018.

2. The instant writ petition has been filed under Articles 226/227 of the Constitution of India inter alia for quashing the order dated 14.03.2018 (Annexure P-12) passed by the Sub Registrar, UT, Chandigarh-respondent No.2 and order dated 16.04.2018 (Annexure P-16) passed by the Deputy Commissioner-cum-Registrar, UT, Chandigarh-respondent No.1.

3. From the record, it is apparent that the earlier owner of the property in question i.e. M/s Rahul Sales Ltd., through its Directors, Late Onkar Anand, Rahul Anand and Renu Anand had availed of a loan facility in the amount of Rs.13.15 crores from respondent No.3 Punjab National Bank against security by way of equitable mortgage of House No.1037, Plot No.3, Street No.E, Sector 27-B, Chandigarh on 17.12.2013. The respondent-bank had got the details of the secured asset registered with the Central Registry of Securitisation Asset Reconstruction and Security Interest of India on 31.03.2014. The said loan account subsequently became irregular as the borrowers could not maintain financial discipline and hence, the same was classified as Non Performing Asset. Thereafter, the respondent-bank initiated recovery proceedings under the provisions of Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short ‘SARFAESI Act’), which culminated in taking over of the possession of the secured asset. It is not disputed that a public notice dated 16.09.2016 (Annexure P-6) was published in the newspaper for the sale of the property in question. Since no bidder came forward in the said auction, a second public auction was fixed for 03.05.2017 at a reserve price of Rs. 11.50 crores vide notice dated 01.04.2017 (Annexure P-7) in which the petitioners emerged as the highest bidders. After deposit of the entire bid amount of Rs. 13.92 crores against the reserve price of Rs. 11.50 crores, physical possession of the property was handed over to the petitioners by respondent No.3-bank along with the Sale Certificate under Rule 9(6) of the Security Interest (Enforcement) Rules 2002. It may be emphasised here that there was no mention at all in the public notice regarding any dues or encumbrances, which may have stood against the said property.

4. On 06.03.2018 when the petitioners and the Authorised Officer of the secured creditor approached respondent No.2 i.e. Sub Registrar, UT, Chandigarh for registration of the Sale Certificate under The Registration Act, 1908, (for short ‘1908 Act’) he refused to register the same vide order dated 14.03.2018 (Annexure P-12) holding that the property in question already stood attached by the Government of Maharashtra under Sections 4 (1) and 5(1) of Maharashtra Protection of Interest of Depositors (in Financial Establishments) Act, 1999 (for brevity ‘MPID Act’) vide Notification dated 22.06.2015. On refusal of registration of the Sale Certificate, the petitioners impugned the order dated 14.03.2018 (Annexure P-12) by preferring an appeal under Section 72 of 1908 Act before the Deputy Commissioner-cum-Registrar-respondent No.1, who dismissed the same vide order dated 16.04.2018(Annexure P-16). It was in the above factual backdrop that the instant writ petition came to be filed before this Court.

5. Learned counsel for the petitioners contended that the orders dated 14.03.2018 (Annexure P-12) and 16.04.2018 (Annexure P-16) passed by respondents No.2 and 1 respectively refusing to register the Sale Certificate dated 31.07.2017 (Annexure P-9) in favour of the petitioners/auction purchasers were not only illegal and arbitrary but also more specifically violated the provisions of 1908 Act as well as the SARFAESI Act. Learned counsel further urged that the embargo sought to be enforced by respondent No.4 -