9911796707
TMI Blog1974 (3) TMI 3X X X X Extracts X X X X X X X X Extracts X X X X ..... 1952-53 and 1953-54. The petitioner No. 1 was a director and the petitioner No. 2 was a shareholder of the company for the above period. They have sold their shares in 1962 and the petitioner No. 1 has ceased to be a director of the company since then. The impugned notices of July, 1967, were served on the petitioner No. 1 in the tax recovery proceedings started against the company. Thereafter, the impugned notices of February, 1973, were served on the company and the premises No. 3, Robinson Street, Calcutta, and 120/6, Masjid Bari Street, Calcutta, were attached for recovery of those taxes. The petitioner's case is this : The company was dissolved on April 3, 1967, under the provisions of sub-sections (1), (2), (3) and (5) of section 56 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r cannot be recovered, then, every person who was a director of the private company at any time during the relevant previous year shall be jointly and severally liable for the payment of such tax unless he proves that the non-recovery cannot be attributed to any gross neglect, misfeasance or breach of duty on his part in relation to the affairs of the company." It has been contended by Mr. Sen Gupta that the Tax Recovery Officer is entitled to proceed against the petitioner No. 1 under this section. His contention is that, thought this section speaks of winding up and liquidation of a private limited company, yet it includes a dissolved company. But I am not impressed by his contention. Section 560 of the Companies Act, 1956, empowers the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the tax of the company under the Companies Act, 1956. But the non-obstante clause in section 179 of the Income-tax Act has made them personally liable to pay such tax provided these conditions are fulfilled : (1) such company is wound up after the commencement of the Act ; and (2) assessed tax cannot be recovered from such company. The words used in section 179 of the Income-tax Act are plain and clear. Hence, the non-obstante clause cannot cut down its construction nor can it enlarge its scope and ambit to enable the revenue authorities to recover the assessed taxes from the directors of a dissolved private limited company. Moreover, the recovery proceedings against the company are still pending in the admitted case, and, therefore, in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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