Kerala State Financial Enterprises Ltd vs Official Liquidator, High Court Of ...

The Supreme Court held that the provisions of the Kerala Revenue Recovery Act, 1968, do not create a charge on the properties of a company in voluntary liquidation under Section 125 of the Companies Act, 1956. The Court clarified that an order of attachment does not equate to the creation of a charge, and thus, the appellant, being an unsecured creditor, cannot claim precedence over the liquidator. The appeal was dismissed, affirming the High Court's ruling that the dues of the appellant do not qualify as government dues under Section 537(2) of the Companies Act.