ORDER Goda Raghuram, J. Heard the several counsel for the petitioners; the learned Special Government Pleader for Commercial Taxes Mr. Krishna Koundinya for the State of Andhra Pradesh, the Commissioner of Commercial Taxes and other designated officials of the Commercial Taxes Department; and other learned counsel for other respondents in the several writ petitions. In all the cases the common issue whether the liability of a dealer or other person in respect of tax, penalty, interest or any other sum payable to the State/Commercial/Sales Tax Department under the provisions of the Andhra Pradesh General Sales Tax Act, 1957 ("the Act") has priority, would prevail and have precedence over even an existing secured debt created by such dealer or person in favour of any other individual, institution or instrumentality, falls for consideration. This issue arises in the context of the provisions contained in section 16C of the Act, which reads : "16C. Liability under this Act to be the first charge. - Notwithstanding anything contrary contained in any law for the time being in force, any amount of tax, penalty, interest and any other sum, if any, payable by a dealer or any other person under this Act, shall be the first charge on the property of dealer, or such person." The above provision was introduced into the principal Act by Amendment Act 9 of 1999 with effect from April 6, 1999. The vires of section 16C of the Act are challenged only in W.P. No. 21865 of 1999 by the A.P. State Financial Corporation ("the Corporation") on several grounds : (a) That the right of the Corporation under section 29 of the State Financial Corporations Act, 1951 ("the 1951 Act") to take over the management or possession of the industrial concern and the right to transfer the property secured in its favour, creates an overriding charge over the assets of the industrial concern and would have precedence in view of the non-obstante clause in section 46B of this Act; (b) The operation of the 1951 Act a Central legislation (Act 63 of 1951) cannot be curtailed or restricted by a State legislation and therefore a charge in favour of the Corporation would prevail notwithstanding the provisions of section 16C of the Act; (c) The Corporation being a secured creditor would have precedence over a crown debt and since the Corporation is established for industrial promotion and development, the loans advanced by it also partake of the nature of public assets. Section 16C of the Act is therefore invalid on account of irrational classification, violative of article 14 of the Constitution; (d) Since the amounts due and payable to the Corporation are liable to be recovered as arrears of land revenue in terms of section 32(g) of the 1951 Act, the debt due to the Corporation is a public debt; (e) The charge created in favour of the Corporation being prior in point of time constitutes a first charge and would prevail; (f) Section 16C of the Act is inconsistent with and repugnant to the provisions of sections 29, 31 and 32 of the 1951 Act and sections 58 and 100 of the Transfer of Property Act (Central legislations) and is void in terms of article 254 of the Constitution. The other cases in this batch of writ petitions fall into three broad categories : (A) W.P. Nos. 13102 of 2000, 19091 of 1999, 24334 of 2001, 24097 of 2003 and 25394 of 2003 are also by the Corporation. In W.P. No. 13102 of 2000 a notice of attachment ordered by the Commercial Taxes Department (Revenue) for recovery of dues under the provisions of the Act is challenged. 13102 of 2000, 19091 of 1999, 24334 of 2001, 24097 of 2003 and 25394 of 2003 are also by the Corporation. In W.P. No. 13102 of 2000 a notice of attachment ordered by the Commercial Taxes Department (Revenue) for recovery of dues under the provisions of the Act is challenged. In W.P. No. 19091 of 1999 a demand notice by the Revenue directing the Corporation to remit the proceeds of the sale of a secured asset ordered by the Corporation under section 29 of the 1951 Act in respect of the property of a dealer attached under the provisions of the Act, is in challenge. In W.P. No. 24334 of 2001 the Corporation challenged a notice of attachment, issued by the Revenue to enable the Corporation to proceed against the attached property for realization of its own dues under section 29 of the 1951 Act, in respect of a borrower who is also a dealer under the provisions of the Act. In W.P. No. 24097 of 2003 the Corporation challenged a letter of the Revenue intimating sale of property under the provisions of the A.P. Revenue Recovery Act, 1864 ("the RR Act"). W.P. No. 25394 of 2003 is a challenge by the Corporation to the notice of attachment of the property of the sixth respondent for tax arrears. The property was attached by the third respondent. The 6th respondent had also defaulted on repayments of a loan advanced by the Corporation. (B) W.P. Nos. 4625 of 2004, 24489 of 2005, 459 of 2006, 25305 of 2007, 5322 of 2008 are filed by the Revenue. In W.P. No. 4625 of 2004 auction of the specified property by the Recovery Officer of the Debts Recovery Tribunal ("the DRT") is challenged. Despite being notified of attachment of the property by the Revenue under the provisions of section 17C of the Act the Recovery Officer of the DRT pursuant to an order of the Tribunal in RP No. 168 of 2003 in O.A. No. 626 of 2002 had conducted auction for recovery of the amounts due to the first respondent - bank. Despite being notified of attachment of the property by the Revenue under the provisions of section 17C of the Act the Recovery Officer of the DRT pursuant to an order of the Tribunal in RP No. 168 of 2003 in O.A. No. 626 of 2002 had conducted auction for recovery of the amounts due to the first respondent - bank. W.P. No. 24489 of 2005 assails the action of the respondent - bank proposing auction of the property under the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 ("the Securitisation Act"), in view of the primacy accorded to tax arrears due by the first respondent - dealer, under the provisions of section 16C of the Act. W.P. No. 459 of 2006 challenges sale of the property of the first respondent by the second respondent as invalid. The first respondent committed breach of the conditions of a tax deferment scheme and became liable to tax under the Act and the Central Sales Tax Act, 1956 ("the CST Act"). Despite intimation by the Revenue of the prioritized claim of the tax arrears under section 16C of the Act, the second respondent sold the 4th respondent's property to the third respondent under the provisions of the Securitisation Act and delivered possession of the property as well. W.P. No. 25305 of 2007 assails an order of the DRT. The third respondent - a registered dealer fell in arrears of tax and penalty under the Act and the CST Act. The respondent - bank issued a sale notification to recover the amounts due to it from the second respondent, pursuant to an order of the DRT. The Revenue applied to the DRT to withhold the amount of arrears of tax and penalty due to it and to make over the same to the Revenue instead of to the respondent - bank. This application I.A. No. 12 of 2006 in O.A. No. 902 of 2002 was dismissed by the DRT, Visakhapatnam by the order dated April 26, 2002. In W.P. No. 5322 of 2008 the Corporation (R2) sold the property of respondent Nos. 3 and 4 (registered dealers) for defaulting in repayment of amounts advanced by the Corporation, under the 1951 Act. The Revenue addressed a letter to the Corporation intimating the tax arrears due by respondent Nos. In W.P. No. 5322 of 2008 the Corporation (R2) sold the property of respondent Nos. 3 and 4 (registered dealers) for defaulting in repayment of amounts advanced by the Corporation, under the 1951 Act. The Revenue addressed a letter to the Corporation intimating the tax arrears due by respondent Nos. 3 and 4, claiming priority under section 16C of the Act and calling upon the Corporation to remit the sale proceeds for securing tax dues of respondent Nos. 3 and 4. The second respondent - Corporation by a legal notice dated August 20, 2007 intimated the petitioner that the assets of respondent Nos. 3 and 4 were seized and sold and an amount of Rs. 4,55,250 was kept in fixed deposit. (C) W.P. Nos. 10744 of 2004 and 5761 of 2005 are by bank/financial institutions. In W.P. No. 10744 of 2004 the bank assails an order of attachment and consequent sale by the Revenue of the assets of the second respondent, which was mortgaged to the petitioner for a loan availed of. The first respondent - Revenue attached and sold the assets secured to the bank even while bank's application in O.A. No. 175 of 2003 was pending before the DRT, Visakhapatnam. W.P. No. 5761 of 2005 is again by a bank challenging the action of the Revenue in attaching the specified property under the provisions of the RR Act even while the petitioner's application before the DRT, Hyderabad for recovery of the amounts due to it from the borrower/dealer is pending. Vires of section 16(c) of the APGST Act, 1957. The policy justification for the impugned provision is the well entrenched common law doctrine of priority of crown debts. The common law doctrine postulates that the State is entitled to claim, for the recovery of the amount of tax due to it from a citizen precedence and priority over unsecured debts due from the said citizen to his other private creditors. The basic justification for such claim of priority rests on the well recognized principle that the State is entitled to raise money by taxation, otherwise it will not be able to function as a sovereign Government at all. The basic justification for such claim of priority rests on the well recognized principle that the State is entitled to raise money by taxation, otherwise it will not be able to function as a sovereign Government at all. This consideration emphasizes the necessity and wisdom of conceding to the State the right to claim priority in respect of its tax dues - Builders Supply Corporation v. Union of India [1965] 65 ITR 91 (SC); AIR 1965 SC 1061 , Dena Bank v. Bhikhabhai Prabhudas Parekh & Co. [2000] 120 STC 610 (SC); [2000] 5 SCC 694. Central Bank of India v. State of Kerala [2009] 21 VST 505 (SC); [2009] 4 SCC 94 considered the issue whether section 38C of the Bombay Sales Tax Act, 1969 and section 26B of the Kerala General Sales Tax Act, 1963 (State legislations under entry 54 of List II providing for a first charge on the property of a dealer or a person liable to pay sales tax), were invalid on account of inconsistency with provisions of the Recovery of Debts due to Banks and Financial Institutions Act, 1993 ("the DRT Act") and the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (the Securitisation Act) in view of the non-obstante provision in sections 34(1) and 35 of the DRT Act and Securitisation Act, respectively. The Supreme Court on an extensive analysis of the provisions of the relevant legislations; articles 245, 246 and 254, entry 45 of List II and entry 54 of List II of the Seventh Schedule to the Constitution; the enacting history of the DRT and Securitisation Acts; provisions of other State legislations incorporating a first charge such as section 14A of the Workmen Compensation Act, 1923, section 11(2) of the Employees Provident and Miscellaneous Provisions Act, 1952, section 74(1) of the Estate Duty Act, 1953, section 25(2) of the Mines and Minerals (Regulation and Development) Act, 1957, section 30 of the Gift Tax Act, 1958, and section 529A of the Companies Act, 1956 held : (A) That the DRT Act facilitated establishment of a two tier system of Tribunals vested with the jurisdiction, powers and authority to summarily adjudicate the claims of banks and financial institutions in the matter of recovery of their dues without being bogged down by the technicalities of the Code of Civil Procedure; and that securitisation enables banks, financial institutions and other secured creditors to recover their dues without the intervention of the courts or Tribunals and incorporates provisions for registration and regulation of securitisation/reconstruction companies, securitisation of financial assets of banks and financial institutions and related provisions; (B) That significantly there is no provision in either of these enactments by which a first charge has been created in favour of banks, financial institutions or secured creditors qua the property of the borrower; (C) That under section 13(1) of the Securitisation Act a limited primacy is given to the right of the secured creditors to enforce security interest vis-a-vis section 69 or 69A of the Transfer of Property Act without the intervention of a court or Tribunal. However, the primacy conferred under section 13(1) does not extend to other provisions like sections 38C and 26B of the Bombay and Kerala Acts by which first charge has been created in favour of the State over the property of the dealer or any person liable to pay the dues of sales tax, etc., section 13(7) of the Securitisation Act envisages application of the money received by the secured creditors, it does not create a first charge in favour of secured creditors; (D) Section 13(9) of the Securitisation Act merely reiterates the priority of the claim of the workers of a company in liquidation spelt out in section 529A of the Companies Act, 1956 vis-a-vis the secured creditors under this Act. However no first charge is created in favour of worker of a company-in-liquidation for the first time; also companies which are not in liquidation or are not being wound up, are not covered by the provisions of sub-section (9). (E) The non-obstante clause in section 34(1) of the DRT Act or section 35 of the Securitisation Act does not override those provisions of the State legislations which create a first charge fortified by non-obstante provision in the State Acts. (E) The non-obstante clause in section 34(1) of the DRT Act or section 35 of the Securitisation Act does not override those provisions of the State legislations which create a first charge fortified by non-obstante provision in the State Acts. (F) After referring to its earlier decisions in Dattatreya Shanker Mote v. Anand Chintaman Datar [1974] 2 SCC 799, State Bank of Bikaner & Jaipur v. National Iron and Steel Rolling Corporation [1995] 96 STC 612 (SC); [1995] 212 ITR 428; [1995] 2 SCC 19, R. M. Arunachalam v. Commissioner of Income-tax [1997] 227 ITR 222; [1997] 7 SCC 698, State of M.P. v. State Bank of Indore [2002] 126 STC 1 (SC); [2002] 10 SCC 441, and quoting with approval the judgment of a Division Bench of the Kerala High Court in Recovery Officer and Assistant Provident Fund Commissioner v. Kerala Finance Corporation ILR [2002] 3 Kerala 4, held that the primacy of the State's first charge in respect of sales tax dues owed by a dealer or other person to the State, fortified by a non-obstante provision in the State legislation is not inconsistent with the provisions of a Central legislation such as the DRT Act or the Securitisation Act which do not incorporate a first charge in favour of a bank or financial institution in respect of the dues owed by a borrower to such bank or financial institution, notwithstanding the generic non-obstante provision in the Central legislation. The primacy of the State's first charge shall therefore have priority. (G) The contention that the claim of a bank or financial institution would have precedence over the claim of sales tax authorities, since the mortgage in their favour was prior in point of time was rejected relying on the following passages of its earlier judgment in State Bank of Bikaner and Jaipur v. National Iron and Steel Rolling Corpn. [1995] 96 STC 612 (SC); [1995] 212 ITR 428; [1995] 2 SCC 19 : "7. ... Section 100 of the Transfer of Property Act deals with charges on an immovable property which can be created either by an act of parties or by operation of law. [1995] 96 STC 612 (SC); [1995] 212 ITR 428; [1995] 2 SCC 19 : "7. ... Section 100 of the Transfer of Property Act deals with charges on an immovable property which can be created either by an act of parties or by operation of law. It provides that where immovable property of one person is made security for the payment of money to another, and the transaction does not amount to a mortgage, a charge is created on the property and all the provisions in the Transfer of Property Act which apply to a simple mortgage shall, so far as may be, apply to such charge. A mortgage on the other hand, is defined under section 58 of the Transfer of Property Act as a transfer of an interest in specific immovable property for the purpose of securing the payment of money advanced or to be advanced as set out therein. The distinction between a mortgage and a charge was considered by this court in the case of Dattatreya Shanker Mote v. Anand Chintaman Datar [1974] 2 SCC 799. The court has observed that a charge is a wider term as it includes also a mortgage, in that, every mortgage is a charge, but every charge is not a mortgage. The court has then considered the application of the second part of section 100 of the Transfer of Property Act which, inter alia, deals with a charge not being enforceable against a bona fide transferee of the property for value without notice of the charge. It has held that the phrase 'transferee of property' refers to the transferee of the entire interest in the property and it does not cover the transfer of only an interest in the property by way of a mortgage. 8. ... The argument, though ingenious, will have to be rejected. Where a mortgage is created in respect of any property, undoubtedly, an interest in the property is carved out in favour of the mortgagee. The mortgagor is entitled to redeem his property on payment of the mortgage dues. This does not, however, mean that the property ceases to be the property of the mortgagor. The title to the property remains with the mortgagor. Therefore, when a statutory first charge is created on the property of the dealer, the property subjected to the first charge is the entire property of the dealer. This does not, however, mean that the property ceases to be the property of the mortgagor. The title to the property remains with the mortgagor. Therefore, when a statutory first charge is created on the property of the dealer, the property subjected to the first charge is the entire property of the dealer. The interest of the mortgagee is not excluded from the first charge. The first charge, therefore, which is created under section 11AAAA of the Rajasthan Sales Tax Act will operate on the property as a whole and not only on the equity of redemption as urged by Mr. Tarkunde. 10. In the present case, the section creates a first charge on the property, thus clearly giving priority to the statutory charge over all other charges on the property including a mortgage. The submission, therefore, that the statutory first charge created by section 11AAAA of the Rajasthan Sales Tax Act can operate only over the equity of redemption, cannot be accepted. The charge operates on the entire property of the dealer including the interest of the mortgagee therein. 11. Looked at a little differently, the statute has created a first charge on the property of the dealer. What is meant by a "first charge" ? Does it have precedence over an earlier mortgage ? Now, as set out in Dattatreya Shanker Mote's case [1974] 2 SCC 799, a charge is a wider term than a mortgage. It would cover within its ambit a mortgage also. What is meant by a "first charge" ? Does it have precedence over an earlier mortgage ? Now, as set out in Dattatreya Shanker Mote's case [1974] 2 SCC 799, a charge is a wider term than a mortgage. It would cover within its ambit a mortgage also. Therefore, when a first charge is created by the operation of law over any property, that charge will have precedence over an existing mortgage." (H) Repelling the contention that the earlier judgments in State Bank of Bikaner & Jaipur [1995] 96 STC 612 (SC); [1995] 212 ITR 428; [1995] 2 SCC 19 and R. M. Arunachalam v. Commissioner of Income-tax [1997] 227 ITR 222 (SC); [1997] 7 SCC 698 require reconsideration for incorrectly appreciating the true import of the judgment in Dattatreya Shanker Mote [1974] 2 SCC 799, the court held : "In our opinion, the judgments in State Bank of Bikaner & Jaipur v. National Iron and Steel Rolling Corporation [1995] 96 STC 612 (SC); [1995] 212 ITR 428; [1995] 2 SCC 19 and R. M. Arunachalam v. Commissioner of Income-tax [1997] 227 ITR 222 (SC); [1997] 7 SCC 698 are based on a correct reading of the ratio of Dattatreya's case [1974] 2 SCC 799 and the propositions laid down therein do not call for reconsideration. At the cost of repetition, we consider it appropriate to observe that in Dattatreya's case [1974] 2 SCC 799 the court was not dealing with the statutory first charge created in favour of the State." (I) Applying the several ratios above referred to, the court held that the first charge created by the State Sales Tax Act will have primacy and would prevail even over a decree obtained by a bank. (C.A. No. 3973 of 2006, Bank of Baroda v. State of Kerala). (C.A. No. 3973 of 2006, Bank of Baroda v. State of Kerala). (J) In another appeal (C.A. No. 4174 of 2006 Ahmad Koya v. District Collector, Kollam), the judgment of the Division Bench of the Kerala High Court was affirmed and thus the view that the statutory first charge created under the Kerala General Sales Tax Act would not only prevail over a prior mortgage in favour of a bank but would also nullify a sale of the property effected at the instance of the bank through the DRT process and even where the property was in possession of the auction purchaser, consequent on a sale of the mortgaged property in his favour through judicial process. As a result of the above analysis the writ petitions are disposed of as under : (A) W.P. No. 21865 of 1999 filed by the Corporation challenging the vires of section 16C of the Act is without merit or force. The impugned legislative provision is legislatively competent and impeccable. This writ petition is accordingly dismissed. (B) W.P. Nos. 13102 of 2000, 19091 of 1999, 24334 of 2001, 24097 and 25394 of 2003 are filed by the Corporation in the circumstances and for the reliefs, already adverted to. (i) In W.P. No. 13102 of 2000 the relief sought of quashing the orders of attachment passed by the Revenue, is unsustainable in view of the provisions of section 16C of the Act. Hence the writ petition requires to be dismissed and is accordingly dismissed. In exercise of its powers under section 29 of the 1951 Act the Corporation has sold the assets of the dealers to realise dues from them. The amounts due to the Revenue from these dealers (R3 and R4) are Rs. 13,92,578 and 13,31,102, while the amounts realized by the Corporation from the sale of the assets of these dealers is Rs. 8,25,000 and Rs. 12,00,000, respectively, i.e., lesser than the amounts due from these dealers to the Revenue. Accordingly the petitioner is liable to pay to the Revenue the amounts realized from the sale of the assets of respondent Nos. 3 and 4. If the petitioner has deposited these amounts in an FD, the petitioner shall also be liable to pay the interest accrued/received thereon, to the Revenue. This writ petition is disposed of as above. Accordingly the petitioner is liable to pay to the Revenue the amounts realized from the sale of the assets of respondent Nos. 3 and 4. If the petitioner has deposited these amounts in an FD, the petitioner shall also be liable to pay the interest accrued/received thereon, to the Revenue. This writ petition is disposed of as above. (ii) In W.P. No. 19091 of 1999 a notice of demand under section 25 of the Act and an order of attachment dated July 14, 1999 is challenged. The liability of the defaulting dealer/Bharani Oils, Kattamur, E.G. District to the Revenue under the Act and the ST Act is Rs. 1,10,93,513. The petitioner - Corporation sold the property of the defaulting dealer for recovery of its dues, under section 29 of the 1951 Act. Interim directions were issued in this writ petition granting stay of the attachment ordered by the Revenue, subject to the condition that the amounts realized by the petitioner on disposal of the defaulting dealer's unit should be kept in a separate deposit in a bank. The relief sought in this writ petition is unsustainable and is accordingly rejected. The amount realized by the petitioner along with the interest accrued on the amount consequent on its deposit in a bank is liable to be made over to the Revenue. This writ petition is disposed of as above. (iii) In W.P. No. 24334 of 2001 the Corporation has questioned the attachment ordered by the Revenue of the property of the dealer towards realization of sales tax dues under the provisions of the Act. The liability of the second respondent dealer to the Revenue is Rs. 23,88,850. Pending the writ petition and in exercise of its power under section 29 of the 1951 Act, the petitioner - Corporation sold the mortgaged assets of the defaulting dealer including the land, buildings, plant and machinery and realized an amount of Rs. 19,50,000. By interim orders of this court dated November 27, 2001 the petitioner was directed to deposit the amount equivalent to the tax liability of the defaulting dealer in an interest yielding deposit and to maintain a separate account for this purpose. The relief sought in this writ petition is rejected as unsustainable and the writ petitioner is declared liable to make over to the Revenue the sale proceeds deposited by it as directed together with the interest accrued thereon. The relief sought in this writ petition is rejected as unsustainable and the writ petitioner is declared liable to make over to the Revenue the sale proceeds deposited by it as directed together with the interest accrued thereon. The writ petition is disposed of accordingly. (iv) In W.P. No. 24097 of 2003 the fifth respondent defaulted on tax arrears of Rs. 1,39,24,597. To realize the same the Revenue initiated action under the RR Act and published an auction notice. This is challenged by the Corporation to whom the defaulting dealer defaulted in repayment of a loan advanced by the Corporation. The Corporation challenged the proceedings initiated by the Revenue under the RR Act. By an interim order dated November 17, 2003 this court permitted the petitioner to auction the property (under section 29 of the 1951 Act), within four weeks and on realization of the sale proceeds to deposit the amount equivalent to the tax liability to the Revenue, in a separate account. The petitioner could not conduct the auction. Eventually by an order dated December 22, 2003 this court permitted the Revenue to notify the property for auction within four weeks and directed further that the sale proceeds be kept in a deposit with the Registrar of this court till the disposal of the writ petition. The Revenue conducted the auction on January 12, 2004. As no competitive and responsive bids were received the Revenue aborted the auction process and approached this court for permission to conduct a fresh auction. No auction has however been conducted. In the facts and circumstances the relief sought by the Corporation cannot be granted and the writ petition is dismissed. (v) In W.P. No. 25394 of 2003 the sixth respondent defaulted in payment of taxes under the Act and the CST Act. The dealer also availed financial assistance from the petitioner - Corporation and defaulted in repayment of instalments. The Revenue attached the property of the dealer under the provisions of the RR Act, published on September 20, 2003. The attachment of the dealer's assets by the Revenue is challenged by the Corporation. On December 15, 2003 this court granted liberty to the Revenue to proceed under the RR Act. No sale of the property has however been effected. In the facts and circumstances the relief sought in the writ petition cannot be granted and the writ petition is dismissed. (C) W.P. Nos. On December 15, 2003 this court granted liberty to the Revenue to proceed under the RR Act. No sale of the property has however been effected. In the facts and circumstances the relief sought in the writ petition cannot be granted and the writ petition is dismissed. (C) W.P. Nos. 4625 of 2004, 24489 of 2005, 459 of 2006, 25305 of 2007 and 5322 of 2008 are by the Revenue. (i) In W.P. No. 4625 of 2004 respondent Nos. 3 to 5 were due a total amount of Rs. 16,12,736 towards arrears of tax and interest thereon. To recover the liability, the Revenue initiated proceedings under the RR Act and attachment of the property of the defaulted dealers was also notified. While so the Debts Recovery Officer, DRT, Visakhapatnam conducted auction and sold the property mortgaged to the first respondent - bank with a view to recover the liability of the defaulted dealer to the said bank. The Revenue therefore filed this writ petition to declare the auction of the property conducted on February 26, 2004 by the second respondent - the Debts Recovery Officer as invalid and for a declaration that the Revenue is entitled to recover the arrears of tax by auctioning the properties of the respondent Nos. 3 to 5 in view of the provisions of section 16C of the Act. By an interim order this court directed that the amount of Rs. 8,61,354 (amount due to the Revenue as on February 15, 2004) realized by the second respondent on the sale of the property shall be set apart by the second respondent. Accordingly the second respondent deposited Rs. 8,61,354 with the first respondent - bank on April 1, 2005. The present liability of respondent Nos. 3 to 5 together with interest is stated to be of the order of Rs. 16,12,736 (as on March 31, 2010). As the amount directed to be deposited under the interim order of this court, i.e., Rs. 8,61,354 was on the basis of the amount due from respondent Nos. 3 to 5 by February 15, 2004 and the Revenue estimates the current liability of these respondents to be Rs. 16,12,736 and the property was sold by the second respondent at the instance of the first respondent - bank, the first respondent - bank is declared liable to pay to the Revenue the entire amount currently due by the respondent Nos. 16,12,736 and the property was sold by the second respondent at the instance of the first respondent - bank, the first respondent - bank is declared liable to pay to the Revenue the entire amount currently due by the respondent Nos. 3 to 5 (but limited to the amounts realized on the sale of the properties at the instance of the first e-Bank), since the amount realized on the sale of the property is Rs. 23.20 lakhs. The writ petition is allowed as above. (ii) The Revenue filed W.P. No. 24489 of 2005 to declare the action of respondent Nos. 2 and 3 in bringing the property of the first respondent - defaulting dealer to sale as per the auction notice dated January 7, 2005 issued by the second respondent, as inconsistent with the right of the Revenue under section 16C of the Act. The first respondent committed breach of sales tax deferment incentive and became liable in a total amount of Rs. 18,13,268 under the provisions of the Act and the CST Act. The Revenue initiated proceedings under the RR Act and attached the properties of the first respondent. Meanwhile respondent Nos. 2 and 3 initiated process for auction of the properties of the first respondent under the provisions of the Securitisation Act for recovery of the amount due by the first respondent. The writ petition is filed by the Revenue challenging the auction notice dated November 7, 2005 as inconsistent with the statutory first charge in favour of the Revenue, under section 16C of the Act. This writ petition requires to be allowed and is accordingly allowed as prayed for. (iii) W.P. No. 459 of 2006 is by the Revenue for a declaration that it has a first charge over the property of the first respondent - defaulting dealer. The Revenue initiated proceedings under the RR Act and attached the property, duly notifying the attachment. The second respondent - a financial institution informed the Revenue that the first respondent's property was sold by it pursuant to an auction, for Rs. 80.50 lakhs. The second respondent and the Corporation to which the first respondent had defaulted on repayment of loan instalments had shared the sale proceeds amongst themselves on a pro rata basis. Hence the Revenue is before this court. In accordance with the interim order of this court, the second respondent deposited Rs. 80.50 lakhs. The second respondent and the Corporation to which the first respondent had defaulted on repayment of loan instalments had shared the sale proceeds amongst themselves on a pro rata basis. Hence the Revenue is before this court. In accordance with the interim order of this court, the second respondent deposited Rs. 40,21,558 with a nationalized bank on May 17, 2006, but the Corporation did not deposit the balance amount of the Revenue dues (owed by the first respondent) out of the sale proceeds appropriated by it on a pro rata basis. In the facts and circumstances, the writ petition is allowed as prayed for. The second respondent and the Corporation are declared liable to make over to the Revenue the sale proceeds appropriated by them on pro rata basis, to the extent of the liability of the first respondent to the Revenue up-to-date; and if any balance amount is available after discharging the liability to the Revenue as above, such balance amount may be retained by the second respondent and the Corporation in accordance with their respective entitlement. This writ petition is allowed as above. (iv) W.P. No. 25305 of 2007 is by the Revenue for a declaration that the orders of the first respondent - Recovery Officer, DRT, Visakhapatnam, dated April 26, 2006 rejecting/dismissing I.A. No. 12 of 2006 in R.P. No. 7 of 2003 in O.A. No. 902 of 2002 is unsustainable; that the Revenue has a first charge over the property of the third respondent - dealer; and to declare the entitlement of the Revenue to proceed with recovery of the tax dues of Rs. 10,96,767. The third respondent fell in arrears of tax and was also liable towards penalty. The second respondent - bank issued a sale notification on November 15, 2005 and proceeded to auction the property of the 3rd respondent, pursuant to an order passed by the DRT in R.P. No. 7 of 2003 in O.A. No. 902 of 2002. The Revenue thereupon petitioned the DRT in I.A. No. 12 of 2006 for a direction to withhold Rs. 10,96,767 representing the tax liability of the third respondent. This petition was dismissed by the DRT by the order impugned dated April 26, 2006. This writ petition requires to be allowed and is accordingly allowed. The Revenue thereupon petitioned the DRT in I.A. No. 12 of 2006 for a direction to withhold Rs. 10,96,767 representing the tax liability of the third respondent. This petition was dismissed by the DRT by the order impugned dated April 26, 2006. This writ petition requires to be allowed and is accordingly allowed. The order dated April 26, 2006 of the DRT in I.A. No. 12 of 2006 in R.P. No. 7 of 2003 in O.A. No. 902 of 2002 is quashed. The amount realized by the second respondent - bank on the sale of the assets of the third respondent - defaulting dealer is liable to be made over to the Revenue to the extent of the current tax and interest thereon liability of the third respondent to the Revenue. Any balance amount out of the sale proceeds (after payment to the Revenue as aforesaid) may be retained by the second respondent. (v) In W.P. No. 5322 of 2008 the respondent Nos. 3 and 4 were liable to arrears of tax under the Act and the CST Act and RD cess in an amount of Rs. 18,20,273 and Rs. 14,00,379, respectively. The Revenue initiated proceedings under the RR Act and attached the property on July 17, 2007. The Corporation (R1 and R2) exercised powers under section 29 of the 1951 Act and sold the property of respondent Nos. 3 and 4 for recovery of its dues. It would appear that the Corporation deposited an amount of Rs. 4,55,250 out of the sale proceeds in a separate account towards the tax liability under the Act in respect of the fourth respondent. This writ petition by the Revenue requires to be and is accordingly allowed. The Corporation represented by respondents Nos. 1 and 2 is directed to make over to the Revenue an amount representing the up-to-date liability of respondent Nos. 3 and 4 (in respect of which liability the Revenue initiated proceedings under the RR Act), to the extent of the amounts realized by the Corporation from the sale of the assets of respondents 3 and 4 and the interest accrued and received by the Corporation on the deposit of such sale proceeds, if any. (D) W.P. Nos. 10744 of 2004 and 5761 of 2005 are by a bank/financial institution. (D) W.P. Nos. 10744 of 2004 and 5761 of 2005 are by a bank/financial institution. (i) In W.P. No. 10744 of 2004 the petitioner - bank assailed an order of attachment by the Revenue of the assets of the defaulting dealer represented by respondent Nos. 2 to 4 and for invalidation of the sale of assets of these non-official respondents by the Revenue. To recover the tax arrears of Rs. 8,22,158 under the Act and the CST Act from the defaulting dealer this property was put to auction. The auction could not be conducted and as on today it appears no sale of the property has taken place. This writ petition requires to be and is accordingly dismissed. (ii) W.P. No. 5761 of 2005 is by a banking company challenging the action of the Revenue (represented by respondent Nos. 1 and 2) in proceeding against the scheduled property for recovery of sales tax arrears, by attaching the property and proceeding to auction the same. The third respondent defaulted and became liable to tax arrears in an amount of Rs. 28,83,601. The said respondents also availed of credit facility and to secure the same created hypothecation and mortgage of its assets, in favour of the petitioner. In view of the default by the third respondent, the petitioner approached the DRT for recovery of Rs. 56,25,714 with interest. No sale of the property however appears to have taken place either under the DRT Act or under the RR Act. The writ petition is without merit. If the tax arrears liable from the defaulting dealer have since been realized by the Revenue, the petitioner would be at liberty to proceed in accordance with law to recover its dues. The writ petition is disposed of as above. There shall however be no order as to costs in the several writ petitions.