HARDIP SINGH vs THE STATE OF PUNJAB

The Supreme Court held that Section 179 of the Income Tax Act, 1961, applies to directors of a company that has gone into liquidation, even if the resolution for winding up was passed before the Act came into force. The Court clarified that liability under Section 179 arises if any stage of liquidation occurs after the commencement of the Act, thus making the directors jointly and severally liable for the company's tax dues. The appeal was dismissed, affirming the Income Tax Officer's notice to the directors for unpaid tax arrears.