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TMI Blog2020 (12) TMI 784X X X X Extracts X X X X X X X X Extracts X X X X ..... i-12 under section 38(1) of the Maharashtra Value Added Tax Act, 2002 as well as the demand notice dated 18.12.2018 issued to the petitioner by the said respondent under sections 178/267 of the Maharashtra Land Revenue Code, 1966. Petitioner has also challenged the legality and validity of the order of attachment dated 10.06.2019. 2.1. By the prohibitory order petitioner was informed that M/s. Twilight Mercantiles Limited has total outstanding dues under the Maharashtra Value Added Tax Act, 2002 (briefly "the MVAT Act" hereinafter) of Rs. 14,90,32,359.00 for the period 2011-12. Petitioner was directed not to create any charge of any asset owned by the dealer M/s. Twilight Mercantiles Limited which is valued more than Rs. 10,000/- or to par ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gainst a non-executive director of a public limited company. Section 44(6) of the MVAT Act, which is the relevant provision, is applicable to private companies which are registered as dealers under the MVAT Act ; it cannot be applied against public limited companies like M/s. Twilight Mercantiles Limited. 7. In this case, notice was issued on 27.10.2020. On 10.12.2020 the following order was passed :- "2. In this writ petition, petitioner has assailed the legality and validity of the prohibitory order dated 12.02.2018 passed under section 38(1) of the Maharashtra Value Added Tax Act, 2002. 3. Learned counsel for the petitioner submits that M/s. Twilight Mercantiles Limited of which petitioner is one of the non-executive directors is a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a director of the private company during such period shall be jointly and severally liable for the payment of such tax or other amount unless, he proves that the non-recovery cannot be attributed to any gross neglect, misfeasance or breach of duty on his part in relation to the affairs of the said company." 13] A careful perusal of the said Section as extracted above, would go to show that first of all the said section is subject to the provisions of the Companies Act, 2013. Secondly, the provision says that if any tax or other amount recoverable under MVAT Act from a private company, whether existing or wound up or under liquidation, for any period cannot be recovered, then the same can be recovered from every person who was a director o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncorporated under the Companies Act, 2013 or under any previous company law. "Private Company" is defined under Sub Section (68) to mean a company having a minimum paid up share capital as may be prescribed, and which by its articles, restricts the right to transfer its shares; except in case of One Person Company, limits the number of its members to two hundred; and prohibits any invitation to the public to subscribe for any securities of the company. On the other hand, "public company" has been defined under Sub Section (71) to mean a company which is not a private company and has a minimum paid up share capital as may be prescribed. 15.1] Section 3 deals with formation of company. As per Sub Section (1) a company may be formed for any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed. In such circumstances, attachment of the bank account of the Petitioner does not appear to be justified and is without any legal sanction. 18] In that view of the matter, we direct Respondent Nos.5 and 6 to unfreeze the bank account of the Petitioner bearing No.02121000006167 in HDFC Bank, Goregaon (E), Mumbai forthwith. 19] Writ Petition is accordingly allowed. However, there shall be no order as to costs." 10. Having regard to the above and on due consideration, we are of the view that the present case is squarely covered by our decision in Shri. Girdhari Lal Lath (supra). Consequently, the impugned prohibitory order dated 12.02.2018, the demand notice dated 18.12.2018 as well as the attachment order dated 10.06.2019 cannot be su ..... X X X X Extracts X X X X X X X X Extracts X X X X
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