Liabilities of directors
suman kumar mishra
(Querist) 23 January 2011
This query is : Resolved
Director of company if not working with a company ? Is he/she responsiable for the liabilities
pritamsaini
(Expert) 23 January 2011
yes Director are liable.
Advocate. Arunagiri
(Expert) 23 January 2011
The directors are not personally responsible for the companies liabilities.
Heaven 2011
(Expert) 24 January 2011
Every person who has been designated as executive director is responsible to the company. But the responsibility never makes him personally liable. If he resign and if the form 32 is filed then only he may be exonerated except in some special circumstances.
Regards.
R.venkatesh Naidu
(Expert) 24 January 2011
liabilities of Directors:The directors are under liablity to the third parties for breach of statutory duties and for acts of co-directors.
A. Liablities to third parties:it is 2 types. 1. Under the act: This arises in connection with the issue of prospectus which does not contain the particulars required by the act, or which contains material mis-representations. Liability is enforoced by an action for deciet or fraud. Directors are personally liable in the following circumstanes: (a) If the directors fail to repay application money when minimum, (b) when the allotmet of shares are irregular, (c) If the directors fail to repay application money if the application for the securities to be dealt ini on a recognised stock exchange is not made or refused.
Ifthe liability of diectors has been made unlimited, they are liable to 3rd parties.
2. Independently of the act: Directors are agents ofo the company and hence not liable on contracts entered into as Agent is on behalf of the company. Whenever the agent is liable, the director would be liable. If the principal alone is liable, the only the company is liable. Thus generally the Directors do not incur personal lliability, but ther ae exceptons tin this rule. If the directors aft in their own name and not in the name of company, they are personally liable. If a Director enters into a contract which is Ultra Vires the company, the company is not liable. If the Director commits anny fraud while acting on behalf of the company, he is personally liable to 3rd parties.
B. LIABILITY TO THE COMPANY: 1.during its life time, in the curseof a company's winding up.
So the directors are liable to the company and he is working in the company
Amit Minocha
(Expert) 28 January 2011
Mr Naidu has correctly enlightened nothing to add tehcnically. If not working file Form 32 after resignation
