Promoters Of A Company - The Minds Before Incorporation

Owais.S. Khan, Government Law College (GLC), Mumbai.

ABSTRACT

This Articles highlights the role of Promoters in relation to the corporate personality and their legal position before and after the incorporation of the company. It also strives to comprehend the ambiguous relationship between the company and the promoter, and also their duties and obligations, which are derived from statutory as well as judicial interpretations. Further, the article deliberates on the functions of Promoters vis-à-vis The Companies Act, 2013 and the liabilities imposed upon them, therein. Finally, the piece dwells into the validity of the contracts between the promoters and third party before the incorporation of the Company and the remedy that can be sought by the aggrieved party under the Specific Relief Act, 1963 for its performance, with special relevance to Indian jurisdiction. The article also provides some constructive suggestions apropos the position of promoters that can surely succour in promoting the dual objective of Enhancing the functioning of the Company as an institution and at the same time protecting the interests of its members.