Recovery of firms tax from its member
Recovery of firms tax from its member: Sub-section (4) of section 139 provides that where any tax payable by a member of an association of persons cannot be recovered from the member, the association shall be liable for the tax due by the member.
However, there was no explicit provision for recovery of association’s tax from the member of association.
Through the Finance Act, 2019, two new sub-sections have been inserted in section 139 providing that where any tax payable by an association of persons (AOP) for a tax year cannot be recovered from the AOP, every person who was at any time in that tax year, a member of the AOP shall be jointly and severally liable for payment of tax due by the AOP.
Any member who pays tax due shall be entitled to recover the tax paid from the AOP or a share of the tax from any other member of the AOP.