Section 89 - Liability of directors of private company of CGST ACT, 2017

               89. (1) Notwithstanding anything contained in the Companies Act, 2013, where any
tax, interest or penalty due from a private company in respect of any supply of goods or
services or both for any period cannot be recovered, then, every person who was a director
of the private company during such period shall, jointly and severally, be liable for the

payment of such tax, interest or penalty unless he proves that the non-recovery cannot be
attributed to any gross neglect, misfeasance or breach of duty on his part in relation to the
affairs of the company.
                  (2) Where a private company is converted into a public company and the tax, interest
or penalty in respect of any supply of goods or services or both for any period during which
such company was a private company cannot be recovered before such conversion, then,
nothing contained in sub-section (1) shall apply to any person who was a director of such
private company in relation to any tax, interest or penalty in respect of such supply of goods
or services or both of such private company:
                 Provided that nothing contained in this sub-section shall apply to any personal penalty
imposed on such director.

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