Priority of charges and mortgages in favour of Government bank and Co-operative society

(1) Notwithstanding anything to the contrary contained in any law for the time being in force but subject to any prior claim of the State Government in respect of land revenue, - (a) no charge or mortgage created on any land or interest therein after the commencement of this Act, in favour of the State Government or a co-operative society shall have priority over a charge or mortgage on such land or interest created by an agriculturist in favour of a bank as security for financial assistance given to the agriculturist by the bank after the commencement of this Act and prior to the charge or mortgage in favour of the State Government or the co-operative society; and (b) any charge or mortgage created on any land or interest therein in favour of a bank in respect of financial assistance given to an agriculturist by that bank shall have priority over any other charge or mortgage that may have been created over such land or interest in favour of any person other than the State Government, a co-operative society or any other bank, prior to the date on which the charge or mortgage was created in favour of the bank. (2) Where different charges or mortgages over the same land or interest therein have been created by an agriculturists in favour of the State Government, a co-operative society or a bank or more than one bank, any such charge or mortgage created as security for financial assistance given by the State Government, Co-operative society or the bank or banks by way of term loans for development purposes shall have priority over the other charges or mortgages created in favour of the State Government, co-operative society or any of the banks, provided prior notice of any such financial assistance by way of term loan for development purposes had been given to the State Government, co-operative society or bank and the State Government, co-operative society or bank has concurred in such financial assistance, and where more than one such charge or mortgage is as security for financial assistance given by way of term loan, the charges or mortgages by way of security for term loan for development purposes will rank for priority in accordance with the dates of their creation. Explanation,- For the purposes of this section "term loan for development purposes" shall mean financial assistance which would generally lead to improvement of agriculture or building up of assets in agriculture but shall not include financial assistance for meeting working capital, expenses for seasonal agricultural operations and marketing of crops. (3) Nothing contained in this section shall apply to borrowings only from one or more co-operative societies including land mortgage banks.