IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE P.R.RAMAN THURSDAY, THE 24TH MAY 2007 / 3RD JYAISHTA 1929 OP.No. 5963 OF 2002(I) ---------------------- PETITIONER: ------------ INDIAN OVERSEAS BANK, MATTANCHERRY, COCHIN-2. BY ADV. SRI.K.N.SIVASANKARAN SRI.V.V.ASOKAN SRI.SUNIL SHANKER RESPONDENTS: ---------------------- 1. THE STATE OF KERALA, REPRESENTED BY THE CHIEF SECRETARY, GOVERNMENT OF KERALA, TRIVANDRUM. 2. ASSISTANT COMMISSIONER (COMMERCIAL TAXES), MATTANCHERRY. 3. THE TAHSILDAR (REVENUE RECOVERY), TALUK OFFICE, FORT COCHIN, COCHIN-1. 4. TOLASARIA AND CO., 7/616, JEW TOWN, KOCHI-2, REPRESENTED BY ITS MANAGING PARTNER. GOVERNMENT PLEADER SRI. GOVINDAN. THIS ORIGINAL PETITION HAVING BEEN FINALLY HEARD ON 24/05/2007, ALONG WITH OP NO. 1792 OF 2003, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: O.P. NO. 5963/2002 ORDER ON CMP NO. 10463/2002 IN O.P. 5963/2002 // DISMISSED // 24.5.2007. SD/- P.R. RAMAN, JUDGE. APPENDIX PETITIONER'S EXHIBITS: EXT.P1 TRUE COPY OF THE DOCUMENT NO. 2204/1976, DATED 26.8.1976. EXT.P2 TRUE COPY OF LETTER OF DEPOSIT OF TITLE DEEDS, DATED 16.4.1986. EXT. P3 TRUE COPY OF LETTER OF DEPOSIT OF TITLE DEEDS DATED 7.8.1998. EXT.P4 TRUE COPY OF THE STATEMENT OF ACCOUNT (PACKING CREDIT) . EXT.P5 TRUE COPY OF THE STATEMENT OF ACCOUNT (BILL PURCHASE). EXT.P6 TRUE COPY OF THE STATEMENT OF ACCOUNT (CASH CREDIT) EXT.P7 TRUE COPY OF THE NOTICE OF SALE ISSUED BY 3RD RESPONDENT. EXT.P8 TRUE COPY OF THE LETTER TO THE 3RD RESPONDENT DATED 22.2.2002. EXT.P9 TRUE COPY OF THE LAWYER NOTICE DATED 23.3.2001. RESPONDENTS' EXHIBITS: NIL. // TRUE COPY // P.S. TO JUDGE. KNC/- P.R. RAMAN, J. = = = = = = = = = = O.P. NOS. 5963/2002 & 1792/2003 = = = = = = = = = = = = = = = = = = = = = = DATED THIS, THE 24TH DAY OF MAY, 2007. J U D G M E N T The prayer made in these original petitions is for a declaration that Section 26A and Section 26 B as introduced by Finance Act 23 of 1999 to the Kerala General Sales Tax Act are unconstitutional and ultra vires. 2. This issue has since been concluded against the petitioners by the Bench decision of this Court in Sherry Jacob v. Canara Bank (2004(3) KLT 1089) wherein it was held that statutory first charge will prevail over any charge or right created in favour of a mortgagee or secured creditor. Following the above decision, this Court in State of Kerala v. Rajmohan Cashew (P) Ltd. (2005(2) KLT 131) held that judicial pronouncements settled the law once for all stating that State has got priority in the matter of recovery of debts due and the specific statutory charge created under the Sales Tax Act notwithstanding the equitable mortgages created by the defaulters in favour of the Banks prior to the liability in favour of the State. It was also held that the State has got priority in the matter of recovery of tax due over the properties mortgaged to financial institutions. O.P. NOS;5963/02 & 1792/03 :2: In view of the authoritative pronouncements as above, there is no merit in these original petitions and following the above decisions, these original petitions are dismissed. P.R. RAMAN, (JUDGE) knc/- O.P. NOS;5963/02 & 1792/03 :3: P.R. RAMAN, J. = = = = = = = = = O.P. NOS. 5963/02 & 1792/2003 J U D G M E N T DATED: 24.5.2007