Research › Search › Judgment

Patna High Court · body

2004 DIGILAW 394 (PAT)

Amar Prasad Sahu v. State Of Bihar

2004-04-07

R.M.PRASAD

body2004
Judgment R.M.Prasad, J. 1. In this writ petition, the prayer on behalf of the petitioner is to quash the order dated 10.6.2003 passed by the Certificate Officer, contained in Annexure 8, rejecting the petitioners objection u/s. 9 of the Bihar and Orissa Public Demands Recovery Act, 1914 and also the demand notice dated 13.9.2001, contained in Annexure 9, issued to him to pay the certificate dues, besides for quashing of the entire certificate proceeding initiated against him. 2. The certificate case arises out of the demand for payment of sales tax and penalty for the periods 1993-94, 1994-95 and 1995-96 against the company, namely, Ranjan Chemicals Limited which is the assessee. 3. It is stated that the petitioner once upon a time was the Director of the said company but later resigned with effect from 2.6.1994, in support whereof the certified copy of Form No. 32 issued by the Registrar of the Companies has been annexed as Annexure 4. 4. It is contended that in view of the Division Bench decision of this Court in the case of Kanhaiya Lal V/s. State of Bihar, reported in 2002 (2) PLJR 553 , liability of a company cannot be enforced against its officers, including Director or Managing Director. Any debt payable by an incorporated Company can be realised only by seizing the assets of the company and not by putting in prison the Managing Director or any of the officers of the Company. Mr. Chatterjee, learned counsel for the petitioner, thus, submitted that the petitioner, who now ceases to be the Director of the Company after June, 1994, the certificate proceeding in question initiated against him for realisation of the aforementioned debt is wholly without jurisdiction and bad in law. 5. Learned counsel for the State, on the other hand, has relied upon the order passed by the Division Bench in L.P.A. No. 184 of 2003 and contended that in view of the said orders, the Director of a Company cannot get away from the said liability. As such, according to him, the petitioner cannot assail the validity of the impugned order on the above ground. 6. In reply, Mr. As such, according to him, the petitioner cannot assail the validity of the impugned order on the above ground. 6. In reply, Mr. Chatterjee submitted that from the order in L.P.A. No. 184 of 2003 it would appear that the earlier decision of the Division Bench in the case of Kanhaiya Lal was not brought to the notice of latter Division Bench and, as such, the said order is per incuriam. In support of his submissions, he relied upon a catena of decisions of the Apex Court. These are (i) 1985 (5) SCC 637, (ii) 1990 (3) SCC 682 and (iii) AIR 2003 SC 2443 . 7. I find substance in the submission of the learned counsel for the petitioner. It is by now well settled that the decision given by a Court of co-ordinate jurisdiction in ignorance of the previous decision renders it per incuriam. It appears that the decision of the Division Bench in the case of Kanhaiya Lal, (supra) was not brought to the notice of the latter Division Bench and the latter Division Bench took a different view in ignorance of the previous decision. 8. In view of the law settled on precedent that when a contrary view is taken by a co-ordinate Bench without noticing the previous decision on the point, the latter decision is not to be taken as precedent on the point. 9. Thus, the certificate proceeding itself initiated against the petitioner, in the facts and circumstances aforementioned, is bad in law and the orders passed therein against him are also bad. 10. The writ application is, thus, allowed/The certificate proceeding, bearing Certificate Case No. 3/2001 pending before the Certificate Officer, Patna and the order passed therein are quashed. In the facts and circumstances, there shall be no order as to costs. 11. However, this order shall not come in the way of Certificate Officer from proceeding further as against the Company, for realisation of debt.