A purposive approach to finding responsibility - (28 Aug 2015)

Banking

The Supreme Court in recent judgments considering responsibility of dishonoured cheques issued by or on behalf of a company has reiterated its desire to facilitate payment, rather than get bogged down in technicality. In MANU/SC/0720/2015, the Court refused the contention of a director who had made payment on behalf of the company that the company had not been made party to the proceedings and his role in its daily conduct not determined. While in MANU/SC/0883/2015 – on the thinnest averment in the complaint – the Court agreed that responsibility for the daily conduct of the business lay on all directors of a defaulting company, one that was proving particularly difficult to serve notice to. Decisions by the Supreme Court seemingly obfuscating what actually constitutes conduct of day-to-day business, actually bring the issue to a simple conclusion: the more one tries to throw the veil of incorporation over themselves, the quicker the court is in taking it off.

Tags : BEEN GUV'NOR-ING DAY TO DAY?