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Kerala HC Modifies Order: Onus to Prove Negligence on Director
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Kerala HC Modifies Order: Onus to Prove Negligence on Director

August 3, 2026

The Kerala High Court modified an order stating that the onus to prove negligence in the non-recovery of tax dues lies on the director, and not the Principal Secretary.

Kerala HC Modifies Order: Onus to Prove Negligence on Director

The Kerala High Court has modified a previous order relating to the recovery of tax dues under Section 39 of the Kerala Value Added Tax (KVAT) Act. The court clarified that the onus to prove absence of negligence in matters concerning non-recovery of tax dues falls on the director of the company, not the Principal Secretary as previously stated.

This modification addresses a critical aspect of tax liability and accountability among corporate officers, affirming the responsibilities associated with directorial positions in the context of tax compliance. The court underscored the need for proper oversight and diligence by directors to safeguard against potential tax liabilities.

For practitioners, this ruling serves as a significant reminder of the heightened accountability that directors hold under tax laws. Legal professionals must advise clients on the importance of diligent managerial practices and documentation related to tax affairs to limit personal liability for non-compliance.

Citations

  • Writ Petition No. 456/2026 (Kerala HC)
Practice Areas:tax

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