AIR 2011 KERALA 24 ::2011 CLC 210 (KER) ::(2011) 102 CorLA 13.1 ::(2011) 101 CorLA 9.2 ::(2011) 3 CurCC 342 ::(2011) 2 BankCas 286 ::(2011) 1 Ker LT 137 ::(2011) 1 Lab LN 798 ::(2011) 99 AllIndCas 653 (KER)

Kerala High Court

Hon'ble Judge(s): C. K. Abdul Rehim , J

Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act (54 of 2002) , S.13(9) Proviso— Companies Act (1 of 1956) , S.529A— Preferential payments - Workmen's dues - Recovery proceeding by secured creditors u/S.13(4) of Act - Unless company is ordered to be wound up or any proceedings for winding is pending - Workmen neither entitled to raise objection against proceedings initiated by secured creditor nor entitled to claim any priority in distribution of amounts realized under recovery. Section 13(9) of SARFAESI Act deals with a situation wherein more than one secured creditor financing with respect to a particular financial asset. It stipulates that, in such case no secured creditor shall be entitled to exercise any or all of rights conferred under Section 13(4), unless exercise of such right is agreed upon by other secured creditors representing not less than 3/4th in value of amount outstanding as on date. The first proviso to Section 13(9) provides that, proceeds out of sale of secured assets with respect to a company in liquidation shall be distributed in accordance with provisions contained under Section 529A of Companies Act, 1956. The second proviso to S. 13(9) deals with a situation where company is wound up. It specifies that in such cases secured creditors can proceed with sale of secured assets, subject to ap....