9911796707
TMI Blog1996 (10) TMI 464X X X X Extracts X X X X X X X X Extracts X X X X ..... o be prosecuted under section 16(3)(h), Rajasthan Sales Tax Act, 1954 (in short, the Act ) and to quash the notice dated September 13, 1990, annexure 8; (3) the respondent be restrained from recovering from the petitioner the amounts of tax, interest and penalty outstanding against M/s. Ratanada Chemicals Ltd., Industrial Area, Jodhpur (respondent No. 3); (4) to declare the provisions of section 9-D of the Act as ultra vires of the Constitution of India; and (5) to quash the circular dated October 24, 1989 regarding personal liability of directors, annexure 9, issued by Commissioner, Commercial Taxes, Jaipur. 2.. The petitioner s case is that he was one of the directors of M/s. Ratanada Chemicals Limited, Industrial Area, Jodhpur. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tended that the provisions of section 9D of the Act were inconsistent with the provisions of the Companies Act, 1956, Companies Act, being Central Act, will prevail and not the provisions of section 9D of the Act and, therefore, they deserved to be declared as unconstitutional. He further contended that the respondent-company was always a public limited company, the provisions of section 9D were not applicable to it and as such these provisions could not be invoked against the petitioner for effecting the recovery of the amounts of tax, interest and penalty outstanding against the respondent-company. 5.. In reply, it has been contended by the learned counsel for the department that the petitioner being a director of the respondent-company ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act and the legality of the circular, annexure 9. In view of the aforesaid findings, it is not necessary to decide the validity of section 9D of the Act and legality of the circular, annexure 9, in this case. 8.. The third question for consideration is about the validity of the notice dated September 13, 1990, annexure 8. The notice, annexure 8, states that the petitioner did not deposit the outstanding amounts of tax and interest despite granting several opportunities. He has also been asked by it to show cause as to why he should not be prosecuted under section 16(3)(h) of the Act. Clause (h) of sub-section (3) of section 16 ran as under: (h) If any person wilfully refuses or fails to pay the amount of any demand notice, and a p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The petitioner may still file its reply and produce evidence in support thereof. Prima facie the notice, annexure 8, appears to be valid. It cannot be quashed. 10.. In the result, the writ petition is partly allowed. The respondent Nos. 1 and 2 are restrained from invoking the provisions of section 9D, Rajasthan Sales Tax Act, 1954 or corresponding provisions of the Rajasthan Sales Tax Act, 1994 against the petitioner for effecting the recovery of the amounts of tax, interests and penalty outstanding against M/s. Ratanada Chemicals Limited, Marudhar Industrial Area, Jodhpur (respondent No. 3). 11.. The petitioner is given an opportunity to file his reply to the notice dated September 13, 1990, annexure 8, within one month of the receipt ..... X X X X Extracts X X X X X X X X Extracts X X X X
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