DINESH T. TAILOR Vs. TAX RECOVERY OFFICER

JUDGEMENT

(1.) Rule. With the consent of the learned Counsel appearing on behalf of the petitioner and the learned Counsel appearing on behalf of the Revenue, the petition is taken up for hearing and final disposal. Counsel for the respondents waives service.

(2.) The petitioner was appointed as an Additional director of a company by the name of Yazad Investment & Finance Private Limited on 2 January 1987. During the period when he was a director, the petitioner signed audited accounts of the company on 30 June 1987 and 30 June 1988. The petitioner resigned as a director of the company on 14 October 1989. Form 32 was filed with the Registrar of Companies notifying that the petitioner ceased to be a director.

(3.) A demand was raised on the company for assessment year 1990-1991. An assessment order under Section 143(3) was made by the Assistant Commissioner of Income Tax, Central Circle 30, Mumbai for the company. The Assessing Officer initiated proceedings under Section 179 of the Income Tax Act, 1961 against the petitioner on the ground that though there was a demand of Rs. 25.64 lakhs against the company for the period between 1990-1991 to 1995-1996, the dues could not be recovered from the company. By an order dated 3 September 2006, the Assessing Officer held the petitioner to be jointly and severally liable under Section 179 for the payment of the tax dues of the company in the aforesaid amount together with interest payable under Section 220(2). A revised order was issued by the Assessing Officer on 11 October 2006 setting out correct details of the tax due from the company. The amount which was claimed from the petitioner as jointly and severally liable under Section 179 was not altered. An attachment has been levied in respect of a residential flat belonging to the petitioner by an order dated 29 November 2006. The petitioner submitted a representation on 19 June 2007, in which he contended that the non recovery of the tax due from the company was not as a result of any neglect, misfeasance or breach of duty on his part. The petitioner sought that the attachment be lifted.