Chukk Apalli Ramakrishna Prasad Vs Deputy Commercial Tax Officer (Andhra Pradesh High Court)
The Andhra Pradesh High Court disposed of three writ petitions by a common order as they arose from the same issue and related to the same private limited company in liquidation. The petitioners were directors of M/s. Kusalava Batteries Private Limited, which was liquidated under the Insolvency and Bankruptcy Code, 2016 pursuant to orders of the National Company Law Tribunal, Amaravati Bench. During liquidation, commercial tax authorities sought recovery of ₹24,14,944/- from the liquidation proceeds, but the liquidator rejected the claim on the ground that it was not filed in the prescribed format and within the prescribed limitation. The liquidator placed these facts before the NCLT, which ultimately permitted dissolution of the company.
Subsequently, the Deputy Assistant Commissioner issued a notice dated 27.01.2021 under Section 24(5) of the Andhra Pradesh Value Added Tax Act, 2005, calling upon the petitioners, as directors, to pay the alleged tax dues. The petitioners responded on 05.02.2021, contending that recovery under Section 24(5) could be initiated only after exhausting all avenues of recovery against the company and only upon establishing that non-recovery was attributable to gross negligence, misfeasance, or breach of duty on the part of the directors. No further action was taken until 18.09.2025, when the authorities attached the petitioners’ bank accounts under Section 29 of the AP VAT Act. Aggrieved, the petitioners approached the High Court.
