2018 (10) TMI 1227 - HC - Income Tax

Petitione s right to represent the company before and after winding up - Held that - Admittedly, the offence was committed before the winding up proceedings were initiated against the company and at that time official liquidator had not taken over. Liability, if any, cannot operate with retrospective effect. The petitioners are responsible for omissions or commission on behalf of company when the company had not gone into the winding up. Revisional court below has dealt with the arguments raised by the petitioner relying upon the judgment of Supreme Court and Bombay High Court. No contrary judgment has been cited. Hence, no interference is warranted by the third court and all the three petitions are dismissed.

Summary

Issues Involved:
Complaint filed by Assistant Commissioner of Income Tax against company officials after winding up - Representation of company by petitioner post winding up - Liability of petitioners for pre-winding up offences - Interpretation of liability in light of Supreme Court and Bombay High Court judgments.

Analysis:
In the present case, a complaint was lodged by the Assistant Commissioner of Income Tax against the Managing Director, Vice Chairman, and Whole Time Director of a company, who are the petitioners in this matter. The main argument raised by the petitioner's counsel is that post winding up of the company and the official liquidator taking charge, the petitioner cannot represent the company, and the official liquidator should be a necessary party. However, it is noted that the alleged offence occurred before the initiation of winding up proceedings, and the official liquidator had not assumed control at that time. The liability for any wrongdoing cannot be applied retrospectively to the petitioners, as they were responsible for the actions of the company before it entered winding up.

The counsel for the petitioner relied on the absence of the official liquidator to argue against the liability of the petitioners for the pre-winding up offences. The revisional court below considered this argument and referred to judgments from the Supreme Court and Bombay High Court in support of its decision. No contradictory judgment was presented by the petitioner, leading to the conclusion that there is no basis for interference by the court. Consequently, all three petitions are dismissed based on the findings and legal precedents cited in the case.