“Company” means a company incorporated under Companies Act, 2013 or under any previous companies act. A company is a separate legal entity formed to carry out business activities. Being a separate legal entity, it can own properties in its own name. A company can enter into transactions in its own name, can sue and also be sued in its name.
The Doctrine of Lifting the Corporate Veil is a legal concept that allows the courts to disregard the corporate personality and look beyond the legal façade of a corporation or business entity. A company is a legal entity having a separate identity from the persons incorporating it. A company’s separate legal entity is a legal privilege that should be used only for lawful business activities.
Understanding The Doctrine Of Lifting The Corporate Veil Read More »
The term “Alter Ego” is a Latin word which means the “Other I”. It is an accepted fact that a company is a distinct legal entity separate from its shareholders and directors. By virtue of this common law principle, shareholders and directors are shielded from debts, civil and criminal liability against the company. However, the notion of alter ego allows for a legal exception to this presumption. The Doctrine of Alter Ego forbids the company shareholders and directors from seeking protection under the doctrine of a separate legal entity. The Doctrine of Alter Ego can be used to lift the corporate veil between the directors/shareholders and the company to treat both as one entity.