Personal liability for company tax arrears requires statutory authority and winding-up conditions; recovery against a resigned director fails.

Personal recovery of a company's sales tax arrears from a director is permissible only where the governing statute expressly creates such liability in the context of winding up or liquidation, and the statutory conditions are met. Here, the provisions relied on applied only when a private company was being wound up and tax could not be recovered in liquidation. Because the director had resigned before the recovery action and the company remained in existence and was not wound up or placed in liquidation, the preconditions for fastening personal liability were absent. The recovery proceedings against the director were therefore without jurisdiction and could not be sustained.

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Issues: Whether arrears of sales tax due from a company could be recovered from a resigned director when the company had not been wound up or placed in liquidation.

Analysis: The liability provisions relied upon by the revenue fastened responsibility on directors only in the event of winding up or liquidation of the company. Section 19-B of the Tamil Nadu General Sales Tax Act applied where a private company was wound up, and Section 18 of the Central Sales Tax Act likewise contemplated recovery from a director only where a private company was wound up and the tax could not be recovered in liquidation. The petitioner had resigned long before the impugned recovery, and the company was admittedly still in existence and not wound up. In these circumstances, the statutory conditions for proceeding personally against the petitioner were absent.

Conclusion: The recovery proceedings against the petitioner were without jurisdiction and could not be sustained.

Ratio Decidendi: Personal recovery of company tax arrears from a director is permissible only where the governing statute expressly authorises it in the context of winding up or liquidation and the statutory preconditions are satisfied.

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