SYNDICATE BANK Vs. VASUDA PHARMA CHEM LTD.

JUDGEMENT

(1.) Company Application No.366 of 2012 is filed to permit the authorised officer of the applicant-Bank to continue in possession of respondent No.2's movable and immovable properties till they are sold. Company Application No.367 of 2012 is filed by the same applicant for permitting its authorised officer to conduct sale of respondent No.2's movable and immovable properties by following the procedure under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short 'SARFAESI Act').

(2.) During the hearing of the cases, an issue has arisen as to whether the ratio laid down in Rajasthan Financial Corporation and another v. The Official Liquidator and another, 2005 8 SCC 190 applies to the sales to be held by the secured creditor under the SARFAESI Act.

(3.) In Rajasthan Financial Corporation , the Apex Court held that in respect of the dues recoverable under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 and also under the State Financial Corporations Act, 1951 the Official Liquidator is bound to be associated by the secured creditor as he represents the workmen dues for which a pari pasu charge is held by him. This question, however, was considered by a Division Bench of the Delhi High Court in Kotak Mahindra Bank Ltd., v. Megnostar Telecommunications, Co.App.No.58 of 2012, . By its judgment, dated 17.09.2012, the Division Bench held that the ratio in Rajasthan Financial Corporation has no application to the dues recoverable under the SARFAESI Act. In the process, the Division Bench disagreed with the judgment of the Division Bench of the Punjab and Haryana High Court in Haryana State Industrial & Infrastructure Development Corporation (HSIIDC) v. Haryana Concast Limited, Hisar, 2010 2 ILR(P&H) 284 and also with the judgment of the Madras High Court in K.Chidambara Manickam v. Shakeena and others, 2008 AIR(Mad) 108. I also find that the learned Single Judge of Karnataka High Court has concurred with the judgment of the Punjab & Haryana in Prime Industries, Balangalore v. Official Liquidator of B.S.Refrigerators Ltd., Bangalore and another, 2013 1 BankCas 700.