9911796707
TMI Blog2024 (12) TMI 217X X X X Extracts X X X X X X X X Extracts X X X X ..... IPS may be pleased to admit and allow this petition; (B) YOUR LORDSHIPS may be pleased to issue a Writ of Mandamus or any other appropriate Writ, Order or Direction quashing and setting aside the Revenue Recovery Certificate dated NIL issued by the Respondent No. 2 under Sec.3 of the Revenue Recovery Act, 1980 qua the Petitioner; (C) YOUR LORDSHIPS may be pleased to direct the Respondent No. 2 and 3 to lift the attachment made on immovable property being Building No. A-7, Room No. 103, Bhimashankar Co. Op. Housing Society Ltd., Sector 19-A, Nerul, Navi Mumbai; (D) Pending hearing and final disposal of this petition, YOUR LORDSHIPS may be pleased to stay further implementation of Revenue Recovery Certificate dated Nil (Annexed at Annexure A) issued by the respondent No. 2 under Section 3 of the Revenue Recovery Act, 1980; (E) Ex-parte ad-interim relief in terms of Para (D) may kindly be granted; (F) Such other and further relief/s as may be deemed fit in the facts and circumstances of the present case may kindly be granted. 5.1 The brief facts of the case are that the husband of the petitioner was a Director of M/s. Oren Kitchen Appliances Private Ltd. which came to be in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the petitioner submitted that the dues of the Company cannot be recovered from the Director under Section 53 (3) of the VAT Act read with Section 18 of the Central Sales Tax Act (for short "CST Act") as the late husband of the petitioner had resigned on 07.02.2013.Learned advocate Mr. Mehta invited the attention of the Court to the copy of the Form No. 32 filed by the late husband of the petitioner tendering the resignation as required under the provision of The Companies Act 1956. 6.2 It was further submitted that the respondents could not have initiated any recovery proceedings against the property of the late husband of the petitioner to recover the outstanding dues of the Company under the provisions of the VAT or CST Act. In support of his submissions, reliance was placed upon the decision of this Court, in case of Sadhna Ramchandra Jeswani Vs. Income Tax Officer rendered in Special Civil Application No. 5354 of 2018 and decision in the case of C.V. Cherian Vs. C.A.Patel reported in [2012] 51 VST 71 (Guj). It was submitted that the Director of Company is not personally liable for the sales tax dues of the Company. 6.3. It was submitted that as per the provision of Sub-Secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Maharashtra, Mumbai and therefore, there is an alternative efficacious remedy for the petitioner to challenge such Revenue Recovery certificate under the provisions of the Revenue Recovery Act. 7.4 It was therefore submitted that no interference be made in the impugned proceedings of recovery initiated by the respondents-authorities. 8.1 Having considered the submissions made by learned advocates appearing for the respective parties, it is not in dispute that the husband of petitioner had resigned on 07.02.2013 and has expired on 11.08.2017 whereas, the recovery proceedings were initiated after the death of the husband of the petitioner in the month of June, 2018. It also emerges from the record that the first recovery notice under Section 152 of the Bombay Land Revenue Code 1879 was issued on 07.08.2018 which is placed on record along with the additional affidavit at page 111 of the petition by the respondent. 8.2 Thus, the respondents-authorities have initiated the proceedings under the guise of Sub-Section (3) of Section 53 of the VAT Act read with Section 18 of the CST Act against the dead person. Section 53 (3) of the VAT Act and Section 18 of the CST Act reads as under:- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section specifically deals with offences by companies and the criminal liability is fastened on the Directors who were in charge of and were responsible for the conduct of the business of the Company, but does not at all provide for any personal liability of the Directors to pay the sales-tax dues of the Company nor does it empower the authorities to proceed against the personal properties of the Directors. The very fact that the same Legislature has in the same Act provided for criminal liability of the Directors without providing for any personal liability of the Directors or their personal properties for payment of sales-tax dues of the Company in question, the provisions of Section 78 lend support to the case of the petitioners rather than the case of the authorities. As regards the faint plea of lifting the corporate veil, as per the settled legal position, the corporate veil is not to be lifted lightly. It is only when there is strong factual foundation for lifting the corporate veil that the question of examining the applicability of the principle of lifting such veil would be required to be examined. In neither of the two petitions raising the controversy, the authoritie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ue to initiate action against the director or directors responsible for conducting the affairs of the Company during the relevant accounting period. Hence, the prerequisite condition stipulated by Section 179 of the Act remains unfulfilled in context of the facts available on record by virtue of the impugned order as well as the affidavit-in reply." 8.5 Referring to the above dictum of law, this Court in the facts of the said case for invoking Section 179 of the Income Tax Act, 1961 which is pari materia to Section 53 (3) of the VAT Act and Section 18 of the CST Act held as under:- "8. Reverting back to the facts of the case, we notice that in show-cause notice the Assessing Officer has not laid down sufficient foundation for invoking section 179 of the Act leave alone broadly pointing out he has not even alleged that non-recovery was on account of gross negligent, misfeasance or breach of duty on part of the petitioner in relation to the affairs of the company. His final conclusions in the impugned order are therefore based on the material at his command which was never shared with the petitioner. 9. In the result, impugned order is set aside only on this ground making it cle ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
