https://www.taxtmi.com/caselaws?id=99054 Priority for tax arrears in winding up under section 530(1)(a) of the Companies Act, 1956 is limited to revenues, taxes, cesses and rates that are outstanding on the relevant date and that became due and payable within the preceding twelve months. Sales tax becomes due on the taxing event, not on assessment or demand, so arrears arising from sales outside that period do not qualify for preferential treatment. Penalty liabilities are crystallised as at the relevant date in winding up, and no fresh penal liability can accrue thereafter. Accordingly, priority for the sales tax arrears was denied, while only the penalty accrued up to the relevant date was admitted as an ordinary claim. en-us Wed, 12 Sep 1973 00:00:00 +0530 Wed, 25 Jan 2012 10:23:26 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=99054 Priority for tax arrears in winding up under section 530(1)(a) of the Companies Act, 1956 is limited to revenues, taxes, cesses and rates that are outstanding on the relevant date and that became due and payable within the preceding twelve months. Sales tax becomes due on the taxing event, not on assessment or demand, so arrears arising from sales outside that period do not qualify for preferential treatment. Penalty liabilities are crystallised as at the relevant date in winding up, and no fresh penal liability can accrue thereafter. Accordingly, priority for the sales tax arrears was denied, while only the penalty accrued up to the relevant date was admitted as an ordinary claim. Case-Laws Companies Law Wed, 12 Sep 1973 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=99054