The Supreme Court held that the liability of directors of a ...

Private company director's liability arises only after winding up order under relevant Act; else can't recover dues from them.

Case Laws     VAT / Sales Tax

September 24, 2024

The Supreme Court held that the liability of directors of a private company arises only when the company is wound up after the commencement of the relevant Act. Since no order of winding up was produced, Section 12(1) of the Act had no application. The court quashed the recovery notice issued against the appellant director, as there was no provision under the Act to recover dues of a limited company from its directors. The judgments of the Single Judge and Division Bench were set aside, and the appeal was allowed.

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