Question

Explain the statutory provision under which corporate veil of company may be lifted

Answer 1

Answer:

Statutory Provision

Explanation:

State of U.P., the court held that in suitable cases, the court will lift the corporate veil. It may happen that the corporate personality of the company is used to commit frauds or improper or illegal acts like tax evasion. Thus, the concept of piercing or lifting the corporate veil holds significance.

Answer 2

The corporate veil of the company may be listed during the time of emergency of the company.

Explanation:

• The corporate veil says that the debt which has been taken by the company through other government or non government organisation is liable to be in charge of a personal secretary or a manager or shareholders.

• This helps the manager or the secretary responsible for any loan which has been taken in the name of the the corporate company. This prevents the the happening of a fraud in a corporate sector.

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