M/S. Can Fin Homes Limited vs. The State Of Ap
Held
The High Court, relying on Section 26(E) of the SARFAESI Act and previous judgments, held that the secured creditor's debt has priority over government tax dues. Consequently, the impugned GST attachment and sale notice was set aside, with a direction that any surplus funds after satisfying the petitioner's dues be remitted to the Commercial Tax Department.
Facts
A housing finance company (petitioner) had a property mortgaged to it for a housing loan. The GST authorities subsequently issued an attachment and sale notice in Form GST DRC-16 under Section 79 of the GST Act against the same property to recover tax dues from another entity. The petitioner challenged this notice, asserting its priority as a secured creditor.
Key Issues
The key legal issue was whether a secured creditor's charge over a mortgaged property takes priority over government tax dues sought to be recovered through an attachment notice under the GST Act.
Sections Cited
Section 79, Section 26(E) of SARFAESI Act, Section 31B of the Bankruptcy Act
AI-generated summary — verify with the full judgment below
WP_34349_2025 APHC010662612025
IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI
WRIT PETITION NO: 34349 of 2025 Bench Sr.No:- 18 [3543]
M/s. Can Fin Homes Limited ...Petitioner Vs. The State Of Ap and Others ...Respondent(s)
********** CORAM : SRI JUSTICE NINALA JAYASURYA SRI JUSTICE T.C.D.SEKHAR DATE : 22th July 2026 Present : Advocate for Petitioner: KADIMISETTY SAI SREENADH Advocate(s) for Respondent(s): GP FOR REVENUE, GP FOR COMMERCIAL TAX WP_34349_2025 HON’BLE SRI JUSTICE NINALA JAYASURYA
AND HON’BLE SRI JUSTICE T.C.D. SEKHAR
WP No.34349 OF 2025 ORDER:- (Per Hon’ble Sri Justice T.C.D. Sekhar)
The petitioner is a company registered under the Companies Act, functioning under the Regulatory Supervision of the National Housing Bank. The petitioner is engaged in providing housing loans and related financial services, having operation of its branch network across the state of Andhra Pradesh.
The respondent Nos.5 & 6 approached the petitioner seeking financial assistance, so as to purchase residential flat vide Flat No.202, Seedhi Vinayaka Residency, Gandhibomma Center, V
The judgment continues below.
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