Secured Creditor Priority Under SARFAESI Act Prevails Over Unproclaimed State Revenue Attachment and Auction

sketch of the Bombay High Court
Case
INDIAN OVERSEAS BANK THR. AUTHORISED OFFICER v. STATE OF MAHARASHTRA THR. SECRETARY AND ORS (Bombay High Court, 11-09-2026)
Law
Constitution of India, Maharashtra Land Revenue Code, Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act.

Highlights of the Judgment:

  • Analysis of the statutory priority of secured creditors under Section 26E of the SARFAESI Act over state government dues.
  • Examination of mandatory requirements for valid property attachment and proclamation under the Maharashtra Land Revenue Code.
  • Application of the Full Bench precedent in Jalgaon Janta Sahakari Bank regarding competing state and secured creditor claims.
  • Consequences of failing to register encumbrances or government claims with CERSAI under SARFAESI provisions.
  • Judicial review of state-conducted auctions during the subsistence of prior SARFAESI enforcement measures.