Secured Creditor is having priority charge over the dues of Income Tax Department

Last updated: 26 August 2021
Quick Summary
In a significant ruling, the Bombay High Court has affirmed that a secured creditor holds priority over the Income Tax Department concerning dues from a borrower. The court accepted the argument that the secured creditor, Edelweiss Asset Reconstruction Co. Ltd., had a valid prior charge over the borrower's assets. This decision reinforces the rights of secured creditors under relevant legislation, such as the SARFAESI Act and RDDBFI Act.

Court :
Bombay High Court

Brief :
In Edelweiss Asset Reconstruction Co. Ltd. v. Tax Recovery Officer, Income-Tax Department and Ots [Writ Petition (L) No. 7964 OF 2021 dated July 28, 2021] Edelweiss Asset Reconstruction Co. Ltd ('the Petitioner') has filed the current petition being aggrieved with the Order of Attachment dated January 17, 2013 passed by Tax Recovery Officer ('the Respondent') for seeking recovery of Income Tax dues from the Classic Diamonds (India) Ltd. ('the Borrower').

Citation :
Writ Petition (L) No. 7964 OF 2021 dated July 28, 2021

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Bimal Jain
Published in Income Tax
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