Tax recovery officer attached the properties of C and D, two directors of PQR Pvt Ltd (a company in liquidation) in respect of the tax due from the company and also for interest and penalty due from the company. The two

Under section 179 of the Income Tax Act, 1961 'the Act', every person who was a director of a Pvt. Ltd. company at any time during the relevant previous year shall be jointly and severally liable for the payment of taxes which cannot be recovered from the company, unless he proves that the non-recovery cannot be attributed to any gross negligence, misfeasance or breach of duty on his part in relation to the affairs of the company. Tax dues include penalty, interest, fee and any other sum payable under the Act. There is no necessity to issue a notice to a director, because the position of a person on whom liability is fastened is equated to that of an 'assessee' in default. Accordingly, the proceeding for recovery were valid. However, before recovery of dues from the directors, it is necessary for the revenue to establish that such recovery cannot be made from the company and then alone it can reach the directors who were responsible for the conduct of its business.