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1997 (12) TMI 586 - HC - Companies Law
Issues:
1. Application for direction to engage counsel before Income-tax Tribunal. 2. Liability of ex-director for company's tax demands. 3. Legal obligations of official liquidator in winding-up proceedings. 4. Legality of notice under section 179 of the Income-tax Act. 5. Representation of company by official liquidator in tax matters. 6. Prayers for expeditious disposal of appeals and stay on coercive proceedings. Analysis: 1. The judgment addresses an application filed on behalf of an ex-director of a company in liquidation, seeking direction for the official liquidator to engage counsel before the Income-tax Tribunal in relation to pending appeals for income tax assessments. 2. The court notes that the tax assessments in question were for years preceding the winding-up order, and the ex-director had already been issued notices personally. The court finds no basis to compel the official liquidator to take over the defense of the ex-director, as the assessments were made before the winding-up. 3. The legal obligations of the official liquidator in a winding-up proceeding are discussed, with the court emphasizing that the official liquidator is not obligated to defend suits or legal proceedings for actions taken before the company was wound up. 4. The legality of the notice issued under section 179 of the Income-tax Act is challenged by the applicant, citing precedents from the Calcutta High Court and the Bombay High Court. However, the court decides not to rule on this issue in the present application. 5. The court rejects the argument that the official liquidator should represent the company in the tax matters, highlighting that the liabilities predate the winding-up and the company had already filed appeals through its directors, which are pending. 6. The judgment dismisses the prayers for expeditious disposal of appeals and a stay on coercive proceedings, deeming them misconceived. The court concludes that the application is misconceived and rejects it accordingly.
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