Case Law Details
Prakash B. Kamat Vs PCIT (Bombay High Court)
Bombay High Court held that in absence of any specific provisions in the statute, duty or penalty liability of the company cannot be recovered from its Director, who is not personally liable towards liability of the Company.
Facts- Petitioner is a mechanical Engineer who had developed a smart card based ticketing solution in the year 2000. The assessee company KAPL came to be incorporated on 30th March 2006.
Since disagreement arose between the J V Partners, Petitioner was forcibly removed from the post of Managing Director in January 2009 and his wife as Director, pursuant to which though arbitration clause was invoked, since KFI did not co-operate, arbitration proceedings never took place. Finally, directorship of Petitioner and his wife in KAPL was terminated in September 2009.
It is specific case of Petitioner that during the time when he was Director of the Company, there was no outstanding demand for tax / duty from the Income Tax Department. It is contended that after a long period of 8 years, the Petitioner was served with a show cause notice directing him to reply as to why proceedings under Section 179 of the Income Tax Act,1961 should not be initiated against him for outstanding demand against KAPL the assessee Company.
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