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2023 (2) TMI 467 - HC - Income TaxLiability of directors of private company in liquidation - steps taken against the delinquent Company - lack of jurisdiction of the Assessing Officer to proceed with the show cause notices issued by it under Section 179 - According to the petitioner, as he was not the Director of the Company, he was not liable to receive any notice u/s 179 which provision can be invoked only against a Director of a private Company - HELD THAT:- Applying the ratio of the Judgments cited above, in Vanraj V. Shah [2019 (7) TMI 31 - BOMBAY HIGH COURT], Rajendra R. Singh [2022 (7) TMI 1309 - BOMBAY HIGH COURT] and Mehul Jadavji Shah [2018 (4) TMI 646 - BOMBAY HIGH COURT] to the facts of the present case, that the impugned show cause notices disclose no facts regarding the steps taken by the Revenue to recover tax dues from the delinquent Company. In fact, the show cause notices are mere repetition of the contents of the show cause notice - An affidavit-in-reply filed before us by the Assessing Officer attempts to list out various steps taken by the Revenue to recover tax dues from the Company between the year 2016 until the year 2020. However, as held by this Court in Mehul Jadavji Shah (supra), giving particulars of steps taken against the delinquent Company in an affidavit-in-reply or even in the impugned orders does not meet the requirements of a proper notice to the Director. A perusal of the impugned order discloses that it does not record any of the material which formed the basis for the Assessing Officer to conclude that all steps have been taken to recover the tax dues from the Company. Further, the impugned order does not refer to the Assessing Officer's subjective satisfaction based upon material before it, to conclude that all steps had been taken to proceed against the delinquent Company and such steps had failed. This being a sine qua non for proceeding further, and for assuming jurisdiction under Section 179 failure to disclose this material and to record the satisfaction of the AO in the manner required by the provisions of Section 179 renders the impugned show cause notices and the impugned order dated 14/12/2020 unsustainable at law. We are therefore, of the considered opinion that the impugned show cause notices and the impugned order issued under Section 179 are unsustainable and contrary to the Act.
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