Director liability for unrecovered tax: joint and several responsibility unless absence of gross neglect or misfeasance is proven. Directors of a private company are jointly and severally liable for tax, interest or penalty that cannot be recovered in respect of supplies made during periods they served as directors, unless they prove non-recovery was not due to gross neglect, misfeasance or breach of duty. If the private company converts into a public company, that joint and several liability does not apply to former private-company directors for amounts unrecovered before conversion, except that personal penalties on such directors remain unaffected.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Director liability for unrecovered tax: joint and several responsibility unless absence of gross neglect or misfeasance is proven.
Directors of a private company are jointly and severally liable for tax, interest or penalty that cannot be recovered in respect of supplies made during periods they served as directors, unless they prove non-recovery was not due to gross neglect, misfeasance or breach of duty. If the private company converts into a public company, that joint and several liability does not apply to former private-company directors for amounts unrecovered before conversion, except that personal penalties on such directors remain unaffected.
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