Priority of sales tax /vat or secured creditor

Nitin Panchal (Querist) 07 February 2012 This query is : Resolved
Dear Sir,

Kindly provide us details whether claims of sales tax/VAT prevalis over claims of secured creditor i.e. bank. in Gujarat.
If possible pls.provide judgements of Supreme court or Gujarat High court.

Whether bank can go ahead with sale of mortgaged properties even though sales tax commissioner issued notice.

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Deepak Nair (Expert) 07 February 2012
Dear Nitin,
Experts will not entertain your query unless and until there is any legal issue.
The above query of yours appears to be an academic query.

Nitin Panchal (Querist) 07 February 2012
Dear Mr. Deepak,

Legal issue is there as Sales tax commissioner is objecting bank action. Bank has already taken symbolic possesion and willing to take physical possession.

i u can help.

piyush sharma (Expert) 07 February 2012
Liability of tax prevails over all other liability. But bank can go a head as even if the property is sold liability will not finished.

RAJU O.F., (Expert) 11 February 2012
Sales Tax authority is not secured creditor; whereas bank would be secured creditor. Bank can proceed under SARFAESI Act and if there was surplus after settling the dues of the mortgagor, such balance can be paid by bank towards tax dues.

R.Ramachandran (Expert) 12 February 2012
Dear Nitin,

It is quite unfair on your part. You raised the query earlier at

http://www.lawyersclubindia.com/experts/Securutisation-act-vat-277986.asp

and got the reply. If you have really followed what has been replied there, you could not have raised the current query at all.

Instead of sticking to the same thread for your supplementary queries, why do you open a fresh thread?