(i) While the arrears of the State have priority over private debts owed to ordinary or unsecured creditors, this priority does not extend over secured creditors (subject to statutory exception). The fact that the tax arrears are recoverable as arrears of land revenue makes no difference to this principle;

(ii) In view of s. 35 of the SARFAESI Act, secured creditors have priority over dues of the State;

(iii) The fact that the property was attached by the Revenue before its sale by the secured creditor is of no consequence because the attachment does not create any interest or lien in the property. The attachment may render the alienation void as against all claims enforceable against the attachment;

(iv) A sale by the secured creditor is equivalent to a sale by the owner of the property and vests the purchaser with all the rights and liabilities of the owner;

(v) In order to constitute a “succession”, there must be a transfer of the business and the identity and continuity of the business so transferred must be preserved. A mere transfer of assets is not sufficient to constitute “succession” and to make the transferee liable for the arrears of the transferor.