Director liability for unrecovered GST dues may extend to associated firms and related entities through corporate veil lifting.

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....Section 88(3) of the GST enactments makes directors of a private company in liquidation jointly and severally liable for unrecovered tax dues incurred during their tenure, unless they establish before the Commissioner that non-recovery was not caused by their gross neglect, misfeasance or breach of duty. The notes state that a director's later retirement from an associated partnership does not by itself prevent recovery from that firm's accounts where the person was a partner during the default period. They also address recovery from related entities: interchanged family management and formation of a subsequent company to avoid arrears may justify examination of whether the corporate veil should be lifted.....