Recovery from public limited company directors barred under section 9D, while prosecution notice survives on disputed facts.

Section 9D of the Rajasthan Sales Tax Act, 1954 could not be used to recover a company's tax, interest and penalty dues from the petitioner because the company was found to be a public limited company, while the provision was confined to private limited companies. That recovery action against the petitioner was therefore impermissible. A notice proposing prosecution under section 16(3)(h) was not quashed, because whether the statutory ingredients for prosecution were satisfied depended on disputed questions of fact that could not be decided in writ proceedings. The petitioner was required to reply and contest the matter before the competent authority.

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Issues: (i) Whether section 9D of the Rajasthan Sales Tax Act, 1954 could be invoked against the petitioner for recovery of tax, interest and penalty outstanding against the company, and (ii) whether the notice proposing prosecution under section 16(3)(h) of the Rajasthan Sales Tax Act, 1954 was liable to be quashed.

Issue (i): Whether section 9D of the Rajasthan Sales Tax Act, 1954 could be invoked against the petitioner for recovery of tax, interest and penalty outstanding against the company.

Analysis: The company was found, on the material produced, to be a public limited company and not a private limited company. Section 9D was read as applying only to private limited companies. On that construction, the provision could not be used to fasten liability on the petitioner for recovery of the company's tax dues.

Conclusion: The invocation of section 9D against the petitioner was held impermissible and the petitioner succeeded on this issue.

Issue (ii): Whether the notice proposing prosecution under section 16(3)(h) of the Rajasthan Sales Tax Act, 1954 was liable to be quashed.

Analysis: The notice alleged non-payment of the demand and proposed prosecution in the context of the deeming provision in section 16(5). Whether the statutory ingredients for prosecution were satisfied depended on disputed facts, which could not be adjudicated in writ proceedings. The petitioner was left to file a reply and lead evidence before the authority, and the notice was found to be prima facie valid.

Conclusion: The notice was not quashed and the challenge to it failed.

Final Conclusion: The writ petition succeeded only to the extent of restraining recovery proceedings against the petitioner under section 9D, while the prosecution notice was left open for decision by the competent authority after consideration of the petitioner's reply.

Ratio Decidendi: A provision expressly confined to private limited companies cannot be applied to a public limited company, and a writ court will not quash a prosecution notice where the satisfaction of statutory ingredients depends on disputed questions of fact requiring determination by the competent authority.

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