Customs Can't Claim Priority Over Bank For Recovery Of Dues From Assessee's Property: Madhya Pradesh High Court

The Madhya Pradesh High Court ruled that customs authorities cannot claim priority over banks for the recovery of dues from an assessee’s property. The court held that the rights of secured creditors, such as banks, take precedence over the claims of customs authorities. The case involved a dispute between a bank and customs authorities over the recovery of dues from the sale of an assessee’s property. The court emphasized that the secured creditor’s rights are protected under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act. The ruling reinforces the legal principle that secured creditors have priority in the recovery of dues, providing clarity on the hierarchy of claims in such cases.