IMPORTANT POINT
The inquiry under the Gangster Act focuses on the character of property acquisition, not on the priority of claims by secured creditors.

JUDGMENT :

(Arun Kumar Singh Deshwal, J.)

1. Heard Sri Amrendra Singh, learned counsel for the petitioners and Sri Ratan Singh, learned AGA for the State.

2. Present petition has been filed for the following relief:

"I. Issue a writ, order or direction in the nature of certiorari, for quashing the order of attachment dated 04.05.2023 passed by Police Commissioner, Ghaziabad in the case no. 09/23, u/s 14(1) of the Uttar Pradesh Gangsters and Anti-Social Activities (Prevention) Act, 1986 in State Vs. Rakesh Sharma as much as it relates to the borrower/mortgagor's said property i.e. House no.78 Sector Delta-3, Greater Noida, Gautam Budh Nagar, Uttar Pradesh;

II. Direct the respondent no.3 to handover the physical possession of the said property to the petitioner."

3. Contention of learned counsel for the petitioners is that petitioner no.1 is a housing finance company sponsored by Canara bank. The petitioner-finance company has granted a loan to one Rakesh Sharma to purchase house no.78 Sector Delta-3, Greater Noida, Gautam Budh Nagar, Uttar Pradesh and that the property was also mortgaged to the petitioners in lieu of the above loan facility extended to Rakesh Sharma. It is further submitted that against Rakesh Sharma, the Gangster Act was invoked, and a FIR was registered against him in case crime no.466 of 2022 and during that proceeding, the above property was attached by the Police Commissioner, Ghaziabad vide order dated 04.05.2023 u/s 14(1) of the Uttar Pradesh Gangsters and Anti-Social Activities (Prevention) Act, 1986 (hereinafter referred to as the 'Gangster Act').

4. As the above property was already mortgaged to the bank, which is a secured creditor, the petitioners preferred Criminal Misc. Writ Petition No.3720 of 2024, immediately after the knowledge of the attachment order dated 04.05.2023. That writ petition was disposed of with a direction to Commissioner of Police, Ghaziabad, to consider the representation dated 08.09.2023 of petitioners against the attachment order dated 04.05.2023 and decide the same within 15 days from the date of production of the certified copy of this order.

5. It is further submitted that despite receiving a copy of the order dated 13.03.2024 passed by this Hon'ble Court in Criminal Misc. Writ Petition No.3720 of 2024, the respondent no.3 has not considered the representation of petitioner no.2, and he was simply informed by respondent no.3 vide letter dated 08.05.2024 that the final order regarding the property of Rakesh Sharma has been passed on 04.08.2023, u/s 15 of the Gangster Act and the matter has been referred to the Special Court (Gangster Act). Therefore, representation of petitioner no.2 cannot be considered at this stage. Learned counsel for the petitioners further submitted that the property in question was mortgaged to the bank, and the bank had already issued proceedings to recover its dues against the property in question (attached by respondent no.3), under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as 'the Act, 2002') and petitioners being secured creditors will have first right over the property in question as the Act, 2002 is Central Act and same will prevail over the law made by the Legislature of the State in view of the Article 254 of the Constitution of India.

6. Per contra, learned AGA has submitted that at the time of deciding the Criminal Misc. Writ Petition No.3720 of 2024, petitioners had not informed the court about the order dated 04.08.2023 passed u/s 16 of the Gangster Act by which representation of the accused Rakesh Sharma was rejected and matter was referred to Special Court (Gangster Act) and at this stage, the Commissioner of Police has no authority to pass any order to release the property in question and petitioners have remedy to pursue their case before the Special Court (Gangster Act).

7. After hearing the submission of learned counsel for the parties and on perusal of