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2023 (6) TMI 1138 - BOMBAY HIGH COURTRevision u/s 264 - Rejection of application - Recovery of tax dues of the company from the Director u/s 179(1) - Director is now no more (deceased) - Petitioners are two out of the four legal heirs of one late assessee who was a Director of the company - HELD THAT:- We will have to proceed on the basis that no letter or notice was sent to the deceased before the order dated 7th May 2018 came to be passed. There is also nothing to indicate what steps were taken to trace the assets of the company. Moreover, the order dated 7th May 2018 passed u/s 179 of the Act does not satisfy any of the ingredients required to be met. Before passing an order under Section 179 of the Act, the Assessing Officer should have made out a case as required under Section 179(1) of the Act that the tax dues from the company cannot be recovered. Only after the first requirement is satisfied would the onus shift on any Director to prove that non recovery cannot be attributed to any gross neglect, misfeasance or breach of duty on his part in relation to the affairs of the company. The order impugned passed by respondent no. 1 u/s 264 of the Act is a very brief order in the sense that the only ground on which the application u/s 264 came to be rejected is contained in paragraph 4.2 of the impugned order. Respondent no. 1, without considering any of the submissions made by petitioners, has simply rejected the application under Section 264 of the Act noting that notice of the death of the deceased was not brought to the Assessing Officer by anybody and before the order under Section 179 of the Act was signed by the Assessing Officer and, therefore, as on the date of the passing of the order, there was nothing invalid. In our view, not only this order but also the order passed u/s 179 require to be quashed and set aside. Considering the order there is no ground made out in the order for even commencing proceedings under Section 179.
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