Company law revision question and answer

In what circumstances:
i) may the High Court refrain a person from being directly or indirectly involved in the
management of a company‟s affairs.
ii) may a company make a loan to its directors?
ANSWER
i)
If a person is convicted of any offence in connection with the promotion, formation or management of a company.

If in the course of winding up it appears that a person was knowingly a party to the carrying on of the company‟s business for any fraudulent purpose or with intent to defraud its creditors or creditors of any other person

 If an officer of the company is guilty of any fraud in relation to the company or of any breach of duty to the company.

ii)
 If the company is for the time being private
A subsidiary of the company extending a loan to its holding company which is its director

 A company whose ordinary business includes lending of money, which is lent the company in the ordinary course of business

To enable a director meet expenditure incurred or to be incurred for purposes of the
company or to enable him properly perform his duties as an officer of the company.

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