Tax Dues Can't Be Collected From Director Of Company Under Liquidation Unless Provided By Some Statute: Allahabad High Court Reiterates
Live LawRelying on its earlier decision in A.S. Solanki Vs. State of U.P. and others, the Allahabad High Court has reiterated that tax dues cannot be collected from director of company under liquidation unless it has been provided in any statute. The Court in A.S. Solanki had held that the law laid down in Naresh Chander Gupta could not be said to be a precedent for holding that whenever tax dues were to be recovered from a company, its Director would be personally responsible even though there was no such provision in the relevant statute The Court had held that in respect of realising tax dues or other public revenue, the piercing of the corporate veil would have to be justified and the same could not be done on a mere asking. The Court held that the juristic personality of the corporate body could not be ignored on the mere fact the company had failed to pay the government dues or public revenue and the same would not be sufficient to pierce the veil and make the Directors personally liable. Otherwise, a Director or shareholder cannot be made personally responsible for the dues of a company except of those cases where such a provision is made in the statute or otherwise warranted in law,” held the Court in A.S. Solanki Vs. State of U.P.
History of this topic
Private Property Not Transferred To Company By Owner Cannot Be Auctioned In Recovery Proceedings: Allahabad High Court
Live Law
Recovery Action Against Company Directors Cannot Be Initiated If Status Of Assessee Is Non-Existent: Madras High Court
Live Law
Indirect Tax Cases Weekly Round-Up: 26 May To 01 June 2024
Live Law
Indirect Tax Cases Weekly Round-Up: 7 April To 13 April 2024
Live Law
Director Proves Lack Of Control On Financial Affairs: Bombay High Court Quashes Income Tax Recovery
Live LawDiscover Related