Liability in case or a Company

(1) Liability of Directors of Private Company in Liquidation :- Notwithstanding anything contained in the Companies Act, 1956, when any private company is wound up after the commencement of this Act, and any tax assessed on the company under this Act for any period, whether before or in the course of or after its liquidation, can not be recovered, then, every person who was a director of the private company at any time during the period for which the tax is due shall be jointly and severally liable for payment of such tax unless he proves that the non-recovery can not be attributed to any gross neglect, misfeasance or breach of duties on his part in relation to the affairs of the company. (2) Liability in case of Company in Liquidation (a) Every person- (i) who is a liquidator of any company which is being wound up whether under the orders of a court or otherwise; or (ii) who has been appointed the receiver of any assets of a company (herein after referred to as the "Liquidator"), shall, within 30 days after he has become such liquidator, give notice of his appointment as such to the assessing authority; . (b) The assessing authority shall, after making such enquiries or calling for such information as he may deem fit, notify the liquidator within three months from the date on which he receives notice of the appointment of the liquidator, the amount which in the opinion of the assessing authority would be sufficient to provide for any tax (including any penalty or interest) which is then, or is likely thereafter, to become payable by the company; (c) The liquidator shall not part with any of the assets of the company or the properties in his hand until he has been notified by the assessing authority under clause (b) above and on being so notified, the liquidator shall set aside an amount equal to the amount notified by the assessing authority and, until he so sets aside such amount, he shall not part with any of the assets of the company or the properties in his hand: Provided that nothing contained in this clause shall debar the liquidator from parting with such assets or properties in compliance with any order of a court or for the purpose of the payment of tax and penalty, if any, payable by the company under this Act or for making any payment to secure creditors whose debts are entitled under law to priority of payments over debts due to Government on the date of liquidation or for meeting such cost and expenses of the winding up of the company as are in the opinion of the assessing authority