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TMI Blog2009 (7) TMI 673X X X X Extracts X X X X X X X X Extracts X X X X ..... nst in respect of the amount due from the company invoking the provisions under section 179 of the Act. 2. With regard to the sequence of events, it is to be noted that the assessment orders were passed in respect of the assessment years 1993-94, 1994-95 and 1995-96, which were subjected to challenge by the assessee-company by filing appeals before the Income-tax Appellate Tribunal. Having lost the battle before the Tribunal, three different appeals were preferred before this court, as I. T. A. No. 2 of 2005, I. T. A. No. 9 of 2005 and I. T. A. No. 12 of 2005. When the appeals were being heard in June, 2008, the appellant-company made a submission that they might be permitted to proceed with the steps for settlement by approaching the Sett ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ner preferred a revision petition before the first respondent and after considering the entire facts and figures, the first respondent passed exhibit P3 order upholding exhibit P2 and observing that the case projected by the petitioner was wrong and misconceived in all respects. The petitioner is challenging exhibits P2 and P3 orders along with the consequential proceedings to the extent they have adversely affected the petitioner. 5. The primary contention of the petitioner is that the invocation of power under section 179 of the Income-tax Act is not correct or sustainable for the reason that absolutely no finding has been arrived at by the Departmental authorities holding that the due amount is not recoverable from the company and its a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing out and diversion of the funds to some other company, though the same has been sought to be denied by the petitioner in the reply affidavit. The question is whether the concerned authority was satisfied of the basic ingredients of the statute, as prescribed under section 179, i.e., whether the amount could be recovered from the company or not and whether the non-recovery was because of the gross neglect/misfeasance breach of duty attributable to the directors concerned. It was after referring to the available facts and figures that the concerned authority arrived at a finding in this regard as borne by exhibit P2 and as such the statutory requirement has been very much complied with. This being the position, the challenge raised by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ights and interests of the "secured creditors", submits the learned standing counsel. Reliance is placed on the decision rendered by the apex court in Dena Bank v. Bhikhabhai Prabhudas Parekh and Co. [2000] 5 SCC 694 ; [2001] 107 Comp Cas 157 wherein the right of the "secured creditors" which stands on a higher pedestal is explained in crystal clear terms. The learned standing counsel further submits that the property belonging to the company is not at all enough to satisfy the liability, which is of about Rs. 1.99 crores. This is more so, when there are other better and preferential claims put forward by the secured creditors and, hence, that the action pursued by the Department authorities invoking section 179 of the Act is justified. 9. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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