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Issues involved: Directors' personal liability for company's debt, challenge to revenue recovery action.
In the judgment, the court noted that the petitioners, who are Directors of a company, had given personal guarantee for the company's debt to the first respondent. The court acknowledged that the first respondent, being an institution u/s 71 of the Revenue Recovery Act, was entitled to recover its dues from the petitioners due to the company's default. Therefore, the court held that the revenue recovery proceedings initiated against the petitioners could not be interfered with. However, the court also observed that the company and the Managing Directors had mortgaged movable properties. In light of this, the court directed that the movable properties belonging to the petitioners should be excluded from the recovery proceedings. The court further specified that these movable properties would only be proceeded against if the sale proceeds of other available properties were insufficient to satisfy the dues of the first respondent. In conclusion, the writ petition challenging the revenue recovery action was disposed of with the above directions regarding the exclusion of the petitioners' movable properties from the recovery proceedings unless necessary.
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