JUDGMENT : Akil Kureshi, J. Heard learned counsel for the parties for final disposal of the petition. The petitioner has challenged a notice dated February 13, 2013, at annexure A to the petition issued by the respondent-Income-tax Officer, Surat, under section 179 of the Income-tax Act, 1961 ("the Act" for short). 2. The brief facts leading to the petition are as follows : The petitioner is a director in one M/s. Gipilon Texurising P. Ltd., a company registered under the Companies Act, 1956 (hereinafter to be referred to as the said company). It is the case of the petitioner that in a meeting held on July 15, 1993, of the board of directors of the said company, it was resolved that one person, viz., Mr. Pravin Sakarlal Gandhi along with his family members will take over the control of the management of the company and other directors of the company, who happen to be his brothers and their family members, would be absolved of all the existing and future liabilities of the company. With these internal arrangement between the family members who were directors of the said company, we are not concerned. For the assessment year 1988-89, there was an outstanding demand of L 2.47 lakhs (rounded off) and for the assessment year 1989-90 an out standing demand of L 4.38 lakhs (rounded off) was pending against the said company. Both these demands pertain to penalty levied by the Department against the company under section 271(1)(c) of the Act. It is not in dispute that such penalty is confirmed against the company up to the Supreme Court. What is however not in dispute is that such demands relate to a penalty and such penalty was ordered against the said company. To recover such dues of the company, the respondent herein issued two separate notices, both dated February 13, 2013 ; copies of which are produced at annexure A collectively to this petition stating, inter alia, that : "It can thus be seen that the primary reason for to collect the demand is on account of total closure of business operations, office premises, etc. No provision was made by the company or any of its directors to ensure payment of Government dues which were bound to arise on account of deliberate and known acts of gross neglect, misfeasance of breach of duty by all directors of the company. No provision was made by the company or any of its directors to ensure payment of Government dues which were bound to arise on account of deliberate and known acts of gross neglect, misfeasance of breach of duty by all directors of the company. The condition laid in section 179 of the Income-tax Act for initiating proceedings against the director is therefore satisfied. In view of the above findings and detailed discussion every possible requirement of passing an order under section 179 has been met with the consequently, the above named person is hereby held jointly and severally responsible and liable under section 179 for payment of demand of all income-tax, interest, penalty, etc., pertaining to assessment year 1988-89 which have been raised so far and may be further raised in future. Therefore, since the demand is not recoverable from the company and since Shri Kantilal Sakarlal Gandhi was the director of the company, the liability for payment of tax as mentioned above is fixed upon Shri Kantilal Sakarlal Gandhi under section 179(1) of the Income-tax Act and he will be treated as assessee in default in respect of tax, interest and penalty recoverable from the assessee as included in the aforesaid demand." These notices are challenged by the petitioner in the present petition on one single ground, viz., that under section 179 of the Act, the respondent has no authority to seek recovery against the petitioner and the dues of the said company arising out of the penalty order under section 271(1)(c) of the Act. 3. Such issue is no longer res integra by a decision of the Division Bench of this court in the case of Maganbhai Hansrajbhai Patel v. Asst. [2013] 353 ITR 567 (Guj), dated September 25/26, 2012, in Special Civil Application No. 3910 of 2012 and connected petition. It was held and observed as under (pages 105 and 107 of 180 Comp Cas) : "From the submissions made before us the following three questions need to be answered : . . . '(2) Whether under section 179 of the Act, it is only the principal dues of tax which can be recovered or the interest thereon and penalties also can be the subject-matter of recovery ? . . . . '(2) Whether under section 179 of the Act, it is only the principal dues of tax which can be recovered or the interest thereon and penalties also can be the subject-matter of recovery ? . . .' Coming to question No. 2 the controversy arises in view of the fact that under section 179 of the Act what is made recoverable from the director of a private company is 'tax due'. The apex court in the case of Harshad Shantilal Mehta v. Custodian (1998) 231 ITR 871 (SC) interpreted such term 'tax due' and commented that (pages 947 and 949 of 92 Comp Cas) : 'The first question on which the arguments have been advanced, relates to the meaning of the phrase "tax due" used in section 11(2)(a). Black's Law Dictionary at page 499 defines the word "due", inter alia, as, "owing ; payable ; justly owed . . . Owed or owing as distinguished from payable. A debt is often said to be due from a person where he is the party owing it, or primarily bound to pay, whether the time for payment has or has not arrived . . . The word 'due' always imports a fixed and settled obligation or liability, but with reference to the time for its payment there is considerable ambiguity in the use of the term, the precise signification being deter mined in each case from the context". (underlining ours) Jowitt's Dictionary of English Law, volume I, second edition at page 669 defines "due" as, "anything owing, that which one contracts to pay or perform to another . . . As applied to a sum of money, 'due' means either that it is owing or that it is payable ; in other words, it may mean that the debt is payable at once or at a future time. It is a question of construction which of these two meanings the word 'due' has in a given case" . . . "Tax due" usually refers to an ascertained liability. However, the meaning of the words "taxes due" will ultimately depend upon the context in which these words are used. In the present case, the words "taxes due" occur in a section dealing with distribution of property. At this stage the taxes "due" have to be actually paid out. . . "Tax due" usually refers to an ascertained liability. However, the meaning of the words "taxes due" will ultimately depend upon the context in which these words are used. In the present case, the words "taxes due" occur in a section dealing with distribution of property. At this stage the taxes "due" have to be actually paid out. Therefore, the phrase "taxes due" cannot refer merely to a liability created by the charging section to pay the tax under the relevant law. It must refer to an ascertained liability for payment of taxes quantified in accordance with law. In other word, taxes as assessed which are presently payable by the notified person are taxes which have to be taken into account under section 11(2)(a) while distributing the property of the notified person. Taxes which are not legally assessed or assessments which have not become final and binding on the assessee, are not covered under section 11(2)(a) because unless it is an ascertained and quantified liability, disbursement cannot be made. In the context of section 11(2), therefore, "the taxes due" refer to "taxes as finally assessed".' We are conscious that such interpretation was rendered in the background of the Special Court (Trial of Offences Relating to Transactions in Securities) Act, 1992, and not in the context of section 179 of the Act. However, the above observations throw much light on the interpretation which we are trying to make. The Bombay High Court in the case of Dinesh T. Tailor v. TRO [2010] 326 ITR 85 (Bom) had an occasion to consider the decision in the case of Harshad Shantilal Mehta v. Custodian (1998) 231 ITR 871 (SC) in the context of the question whether penalty imposed under section 271(1)(c) of the Act can be part of 'tax due' under section 179(1) of the Act. It was held and observed as under (page 89) : 'The first submission which has been urged on behalf of the petitioner is that as a director of the company until October 14, 1989, he cannot be held liable in respect of the penalty that was imposed on the company under section 271(1)(c). As already noted earlier, section 179(1) refers to "any tax due from a private company" and every director of the company is jointly and severally liable for the payment of "such tax", which cannot be recovered from the company. As already noted earlier, section 179(1) refers to "any tax due from a private company" and every director of the company is jointly and severally liable for the payment of "such tax", which cannot be recovered from the company. The expression "tax due" and, for that matter the expression "such tax" must mean tax as defined for the purposes of the Act by section 2(43). "Tax due" will not comprehend within its ambit a penalty. The provisions of the Act make a clear distinction between the imposition of a tax on the one hand and a penalty on the other. Section 2(43) defines the expression "tax" in relation to an assessment year commencing on April 1, 1965, and any subsequent assessment year to mean, inter alia, income-tax chargeable under the provisions of the Act. Section 2(43) is as follows : "2. In this Act, unless the context otherwise requires . . . (43) 'tax' in relation to the assessment year commencing on the 1st day of April, 1965, and any subsequent assessment year means income-tax chargeable under the provisions of this Act, and in relation to any other assessment year income-tax and super-tax chargeable under the provisions of this Act prior to the aforesaid date and in relation to the assessment year commencing on the 1st day of April, 2006, and any subsequent assessment year includes the fringe benefit tax payable under section 115WA ;" In several provisions of the Act, a distinction has been made by Parliament between a tax and a penalty . . . The question which arises before the court is not res integra and is covered by the judgment of the Supreme Court in Harshad Shan tilal Mehta v. Custodian (1998) 231 ITR 871 (SC). The Supreme Court considered the provisions of section 11(2)(a) of the Special Court (Trial of Offences Relating to Transactions in Securities) Act, 1992, under which, inter alia, all revenues taxes, cesses and rates due from persons notified by the custodian under sub-section (2) of section 3 to the Central Government or to any State Government or local authority have to be paid or discharged in full. The Supreme Court considered as to whether the expression "tax" under section 11(2)(a) would include interest or penalty under the Income-tax Act, 1961. The Supreme Court considered as to whether the expression "tax" under section 11(2)(a) would include interest or penalty under the Income-tax Act, 1961. This question was answered in the negative.' We are not unmindful of the fact that before the decision of the apex court in the case of Harshad Shantilal Mehta v. Custodian (1998) 231 ITR 871 (SC), the Bombay High Court in the case of Union of India v. Manik Dattatreya Lotlikar (1988) 172 ITR 1 (Bom) had held that the term 'tax due' under section 179(1) of the Act would include interest and penalties also. We may also notice that the Kerala High Court in case of Ratanlall Murarka v. ITO reported in (1981) 130 ITR 797 (Ker) had taken a similar view making following observations (page 800) : 'The only other question in the case relates to the petitioner's challenge of the levy of interest on the tax for the year 1963-64. Counsel for the petitioner maintained that the Act draws a distinction between tax and interest, as appears from section 156, that tax does not take in interest and that as section 179 is silent about interest, the demand for interest is unsustainable. The contention overlooks the petitioner's position and the consequences of his default. It is admitted in the original petition that a notice had been served on the company demanding arrears of tax for the years 1959-60, 1960-61 and 1963-64, as early as April 1, 1969, long before the order, exhibit P7. The company was thus liable for interest under section 220(2). The liability of the petitioner is co-extensive with that of the company. His obligation to pay the tax for the assessment year 1963-64 is obvious and is undisputed. That makes him an assessee within section 2(7) of the Act. That being the position, we do not see how he could escape liability for interest under section 220(2) despite the distinction between tax and interest emphasised by counsel for the petitioner. The contention is, therefore, futile.' The decision of the Kerala High Court in the case of Alex Cherian v. CIT [2010] 320 ITR 49 (Ker) cited by the Revenue however, stands on a different footing. In the said decision, the question whether under section 179(1) of the Act the tax dues would include even the interest and penalty did not come up for consideration. In the said decision, the question whether under section 179(1) of the Act the tax dues would include even the interest and penalty did not come up for consideration. Similarly, in the decision of the Punjab and Haryana High Court in the case of S. Hardip Singh Sandhu v. TRO (1987) 166 ITR 759 (P & H), such a question did not arise. From the above discussion, it can be seen that the apex court in the case of Harshad Shantilal Mehta v. Custodian (1998) 231 ITR 871 (SC) had an occasion to interpret the term 'tax due'. It was noticed that the Act uses the terms the tax, interest and penalty differently. The ratio of the decision of the apex court in the case of Harshad Shantilal Mehta v. Custodian (1998) 231 ITR 871 (SC) was applied by the Bombay High Court in the case of Dinesh T. Tailor v. TRO [2010] 326 ITR 85 (Bom). Additionally, the Bombay High Court also gave its own interpretation to the statutory provisions contained in the Act and held that for the purpose of section 179(1) of the Act, the term 'tax due' would not include the penalty. We may add that section 179(1) of the Act permits recovery of tax dues of any private company from its directors under certain circumstances. Such circumstances being that such tax cannot be recovered from the company and unless the director proves that the non-recovery cannot be attributed to gross negligence, misfeasance or breach of duty on his part in relation to the affairs of the company. Section 179(1) of the Act thus statutorily provides for lifting of corporate veil under given set of circumstances. The liability of the tax dues which is basically fastened on the company, is permitted to be recovered from its director in the case of private company, provided the conditions set out in the said section noted above are fulfilled. In section 179 of the Act, the term used is 'tax due'. The liability of the tax dues which is basically fastened on the company, is permitted to be recovered from its director in the case of private company, provided the conditions set out in the said section noted above are fulfilled. In section 179 of the Act, the term used is 'tax due'. Section 2(43) of the Act defines tax and reads as under : '(43) "tax" in relation to the assessment year commencing on the 1st day of April, 1965, and any subsequent assessment year means income-tax chargeable under the provisions of this Act, and in relation to any other assessment year income-tax and super-tax chargeable under the provisions of this Act prior to the aforesaid date and in relation to the assessment year commencing on the 1st day of April, 2006, and any subsequent assessment year includes the fringe benefit tax payable under section 115WA.' The term 'penalty' has not been defined. The term 'interest' is defined in section 2(28A) of the Act but is in the context of interest payable in any manner in respect of any moneys borrowed or debt incurred and has no relation to interest chargeable under the various provisions of the Act on tax arrears. We may, however, notice that, as observed by the apex court in the case of Harshad Shantilal Mehta v. Custodian (1998) 231 ITR 871 (SC), the Act uses the term 'tax', interest and penalties at various places having different connotations. Section 156 which pertains to notice of demand provides that where any tax, interest, penalty, fine or any other sum is payable in consequence of any order passed under the Act, the Assessing Officer shall serve upon the assessee a notice of demand in the prescribed form specifying the sum so payable. Section 156 reads as under : '156. Section 156 which pertains to notice of demand provides that where any tax, interest, penalty, fine or any other sum is payable in consequence of any order passed under the Act, the Assessing Officer shall serve upon the assessee a notice of demand in the prescribed form specifying the sum so payable. Section 156 reads as under : '156. Where any tax, interest, penalty, fine or any other sum is payable in consequence of any order passed under this Act, the Assessing Officer shall serve upon the assessee a notice of demand in the prescribed form specifying the sum so payable : Provided that where any sum is determined to be payable by the assessee under sub-section (1) of section 143, the intimation under the sub-section shall be deemed to be a notice of demand for the purposes of this section.' When we compare the language used in section 179(1) of the Act with that of section 156, it emerges that in section 179, the term used is 'tax due' whereas in section 156 which is a recovery provision refers to a notice of demand which would specify the sum payable. The sum payable may as provided in the section itself include tax, interest, penalty fine or any other sum which is payable in consequence of any order under the Act. Section 220 of the Act pertains to 'when tax payable and when assessee deemed to be in default'. Section 220(1) provides for time limit for payment of amount otherwise than advance tax specified in the notice of demand under section 156. Section 220(2) provides that if the amount so specified is not paid within such time, the assessee shall be liable to pay interest. Such interest thus would be on the entire sum payable which may include the tax, interest and penalty or any other source found payable. It would, therefore, not be possible to stretch the language of section 179(1) of the Act to include interest and penalty also in the expression 'tax due'. In the case of Ratanlall Murarka v. ITO (1981) 130 ITR 797 (Ker), as already noted, the Kerala High Court did hold that under section 179 of the Act not only the tax dues but also interest can be recovered from the director of a public company. In the case of Ratanlall Murarka v. ITO (1981) 130 ITR 797 (Ker), as already noted, the Kerala High Court did hold that under section 179 of the Act not only the tax dues but also interest can be recovered from the director of a public company. This was on the basis that, according to the court, the company was liable for interest under section 220(2) of the Act. The liability of the director would be co extensive with that of the company and that would make the director an assessee within section 2(7) of the Act. To our mind, the liability of the director to pay the dues of the company arises in terms of section 179(1) of the Act and such liability would be co-extensive as provided in the said provision which as we notice refers to tax dues. The director may be considered an assessee under section 2(7) of the Act which provides that 'assessee' means a person by whom any tax or any other sum of money is payable under the Act. However, the same must be qua the tax of the company which was due and remained unpaid. By virtue of section 179(1) of the Act, the director cannot be held liable for interest and penalty and thereupon be treated as an assessee under section 2(7) of the Act as a person by whom any tax or any other sum of money is payable under the Act." 4. In view of the above decision, impugned notices at annexure A collectively are quashed. The petition is disposed of accordingly. No costs.