RAMSHARAN MITTAL Vs. STATE OF M.P.

JUDGEMENT

(1.) HEARD . The petitioners have challenged the Revenue Recovery Certificate (RRC) issued against the petitioners and the auction proceeding conducted by the authorities.

(2.) THE company named as M/s S.M.Alloys Pvt. Ltd. was incorporated under the Companies Act in the year 1986. It was registered under M.P. General Sales Tax Act, 1958 as well as Central Sales Tax Act. As per the petitioners, they had transferred their entire share capital to Mr.Joginder Nagpal and Mr. Anil Nagpal. An agreement was executed to this effect and Mr.Joginder Nagpal and Mr. Anil Nagpal thereafter had taken the responsibility and liability of the Company. A resolution was passed to this effect in the meeting of the Company held on 17.7.1992. On 5.10.1994, Mr. Joginder Nagpal and Mr. Anil Nagpal also resigned from the Board of Directors of the Company and Mr. Vijender Kumar and Mr. Hemant Kumar were appointed as Directors of the Company. There were dues against the Company in regard to payment of sales tax. The company was closed. When the amount was not deposited, proceedings in regard to recovery of the tax were initiated and RRC was issued. The authority observed that the RRC be sent to the office of the petitioners for recovery of the amount. As per the record (Annexure P/10), tax of Rs.23,58,111/ - was due against the Company in regard to the liability of the payment of tax towards Central Sales Tax and State Tax including entry tax and professional tax. RRC was issued against Mr. Ramsharan Mittal, Mr.Mukesh Mittal and Mr.Sanjeev Mittal.

(3.) THE respondents in the reply denied the allegations of the petitioners. It is pleaded that M/s S.M.Alloys Pvt. Ltd. was granted four acre of land on lease from M.P. Audyogik Kendra Vikas Nigam, Gwalior (MPAKVN). A lease deed was executed by Sanjeev Mittal. Sales Tax Inspector conducted the inspection and submitted a report that M/s S.M.Alloys Pvt. Ltd. had its Head Office at 62 -B, Nehru Nagar, Agra and all the three petitioners were Directors of the Company. Vide letter dt.28.8.1992, M/s S.M.Alloys Pvt. Ltd. informed that Mr. Joginder Nagpal and Mr. Anil Nagpal had been inducted as Directors of the Company, but it was not mentioned in the letter that the petitioners had resigned from the Directorship of the Company. Thereafter on 24.10.1994 Mr. Anil Nagpal and Mr. Joginder Nagpal informed that they had withdrawn themselves from Directorship of the Company and in their place Mr. Vijender Kumar and Mr. Hemant Kumar were inducted as Directors of the Company. It is further pleaded that the amount of tax due against the Company could not be recovered, hence, RRC of Rs.23,58,111/ - was issued. The petitioners are liable to pay the amount.