Existing charges on property under State Tax Laws remain intact even if banks conduct sales as per SARFAESI/RDB Acts: Kerala High Court

A division bench of the Court held that merely because a priority in payment is available to financial institutions under SARFAESI Act or RDB Act, statutory charges created under various State enactments do not vanish.
Chief Justice S Manikumar and Justice Shaji P Chaly with Kerala HC
Chief Justice S Manikumar and Justice Shaji P Chaly with Kerala HC

The Kerala High Court recently held that merely because a priority in payment is available to the financial institutions under the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, 2002 or the Recovery of Debts and Bankruptcy (RDB) Act, 1993, the statutory charge created under various State enactments do not vanish [The Tahsildar (RR) & Ors. v Nizamudeen S & Ors.].

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