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TMI Blog2007 (7) TMI 456X X X X Extracts X X X X X X X X Extracts X X X X ..... y of a shareholder would be limited to his shareholding, be he a promoter or not - In the present case, the findings are that the Company failed to carry out its export obligation. Therefore, the liabilities will have to be borne only by the Company. There is no finding of fraud, or misappropriation against the present appellant. In such a case, penalty on the officer of the company is not permiss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ort production. The unit was a 100% Export Oriented Unit and was eligible for importing of machinery for the purpose of export production. The obligation was to export furfural. While imports were carried out from 1987 onwards and the period of export was 10 years, the company failed to carry out its export obligations. 3. A SCN dated 24-8-2001 was issued proposing to confiscate the imported ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the company adopted reprehensible and mischievous strategies and adopted tactics in dealing with the various Government departments, mis-managed the finances and willfully avoided payment of public money. Based on this, the order has concluded that the Managing Director cannot escape his responsibilities and is liable for penal action. 4. The submission of the Ld. Counsel is that the liabilit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Ld. DR is that since the present appellant was a promoter and the Managing Director, responsibility would rightly fall on him. 6. It is well settled that the rights and obligations of a limited company are the rights and obligations of that legal person and not of Managers or share holder. In such a case, the liability of a shareholder would be limited to his shareholding, be he a promoter o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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