Securutisation act/vat
Nitin Panchal
(Querist) 10 February 2012
This query is : Resolved
Can Bank go for taking possession of the immovable properties of defaulter, if the same has been attached by Commercial Tax commissioner under VAT.
Pls. guide...
M/s. Y-not legal services
(Expert) 10 February 2012
a single property can not be attached for two debts.
but if the property goes to public auction mean., with court's permission bank can collect the excess auction amount which is rest of the amount debited by C.T commissioner..
i dont know the exact provision., but i think so., even just wait for other expert's opinion.
-tom-
R.Ramachandran
(Expert) 10 February 2012
Dear Mr. Nitin,
From your surname, I think you are from Gujarat and your query relates to Gujarat VAT vs. Bank's claims.
Section 48 of the Gujarat VAT Act creates first charge on the properties of dealer who has tax liabilities.
Therefore, the bank even if it is a secured credit cannot have overriding claim.
However, the even if the bank has taken possession of the property, the VAT laws will take precedence. As indicated by Mr. Tom, if there is any surplus proceeds after satisfying the tax dues, the bank can get recovery of its dues from such surplus.
If anybody has to object the bank taking possession, it is not you, but the VAT Authorities of the State.
Nitin Panchal
(Querist) 10 February 2012
thanks for feedback..Then whatever immovable /movable properties are there will be moved illegally by defaulter as there were no security posted by VAT division. And ultimately bank will never recover their dues ...B'cause govt. dept's attached property by just affixing notices.. nothing else no inventory etc...and defaulter will play his game...
Is there any way to protect bank interest...
Pls.. guide..
DEFENSE ADVOCATE.-firmaction@g
(Expert) 10 February 2012
I think you are giving reverse input to know that the defaulter can do.
Still if there is prior charge of lender even Vat liabilities will not have any effect.
In the end both the lender bank and vat that is Govt will fight in the court.
There may even be third party liabilities . That what has happened in famous HARSHAD MEHTA CASE OF MUMBAI the big bull of share market.
prabhakar singh
(Expert) 11 February 2012
nothing needed after what is replied by Mr. Ramachandran.
