Directors liability
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
13 February 2012
hi,
dear please details about the provision of directors personal liability in case of private limited co., . Also in case of issue of cheques (which are not honoured by bank due to insufficient fund) as a directors of company.
dear please details about the provision of directors personal liability in case of private limited co., . Also in case of issue of cheques (which are not honoured by bank due to insufficient fund) as a directors of company.
CS Mitesh Mehta
(Expert)
14 February 2012
As a general rule, since the company and its Director are separate entities, the Director has no personal liability
on behalf of the company. However, under certain circumstances, a Director may be held liable on behalf of the company
Under the Negotiable Instruments Act, 1881, if a company issues, and later dishonours a cheque which was presented for discharge of debt or other liability,every person who at the time of such dishonor was in charge of overall control of the day-to-day business of the company (both under law and as a matter of fact), shall be deemed to be guilty of the offence and shall be liable to be proceeded against. If the offence is committed with the consent or connivance of, or is attributable to the neglect of the Director, such Director shall be deemed to be guilty and liable to be proceeded against.
on behalf of the company. However, under certain circumstances, a Director may be held liable on behalf of the company
Under the Negotiable Instruments Act, 1881, if a company issues, and later dishonours a cheque which was presented for discharge of debt or other liability,every person who at the time of such dishonor was in charge of overall control of the day-to-day business of the company (both under law and as a matter of fact), shall be deemed to be guilty of the offence and shall be liable to be proceeded against. If the offence is committed with the consent or connivance of, or is attributable to the neglect of the Director, such Director shall be deemed to be guilty and liable to be proceeded against.
Message likes :
1 times
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- GST REFUND ISSUE ON PURCHASE OF PLANT AND MACHINERY
- WRONG GSTR7 ENTRIES ACCEPTED ERRONEOUSLY
- Expert Help Required for TDS Refund 100000 Through TRACES – AY 2022–23
- IMPORT PURCHASE ENTRY PASSED IN BOOKS OF ACCOUNT
- FAST DS 26 Undisclosed Foreign Asset Disclosure Scheme 2026
- Regime change
- Tally: Imported bank entries do not show up in manual reconciliation
- Sales of goods of amount Rs97 lakhs to a party
- Confused About My Career After 12th — Cyber Security, AI or Finance? Need Guidance
- FAST-DS 2026 Under Tax Law - No recourse or support for person declaring via this scheme?
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
