Rishi Kant Jha Vs Union of India (Patna High Court)
In the case Rishi Kant Jha Vs Union of India, the Patna High Court addressed the liability of ex-directors concerning GST demands for transactions conducted after their resignation. The petitioners, former directors of M/s Atulya Ananya Advertising and Marketing Pvt. Ltd., contested a demand order issued against the company for April and May 2024, asserting their resignation on January 23, 2024, as per a board resolution. They argued that no demand could be levied against them individually. The court noted that the demand was raised in the company’s name and not specifically against the petitioners. Furthermore, the company itself was not made a party to the writ petition. The court held that the petitioners must establish their non-liability before the Assessing Officer, as the assessed transactions occurred after their resignation. With this clarification, the court dismissed the petition, emphasizing the need for the petitioners to address the issue through proper administrative channels. This decision underscores the principle that ex-directors are not automatically liable for a company’s tax obligations arising after their resignation, provided they can substantiate their case to the authorities.
FULL TEXT OF THE JUDGMENT/ORDER OF PATNA HIGH COURT
