Lifting The Veil Of Incorporation Pdf

A study on lifting of corporate veil with reference to case laws 1p.

Lifting the veil of incorporation pdf. The veil shall be lifted to prevent the avoidance of recognition by the eyes of equity. In turn a protective veil of sorts is cast over the true controllers of the company. This doctrine emphasizes that a company has a separate entity from its. Lifting the veil occurs where the courts or law disregard the corporate personality of the company in deserving circumstances.

Arya r 1 student b a llb 3rd yr saveetha school of law saveetha institute of medical technical sciences saveetha university chennai 77 tamilnadu india 2 assistant professor saveetha school of law saveetha institute of medical technical sciences. The issue of corporatelifting the. While it is possible to fi nd examples of veil. The concept of lifting the veil under the english doctrine there are a number of exceptions to the separate legal personality principle.

Abuse of the separate legal personality separate legal personality. Lifting the veil of incorporation. The incorporation of a company creates a separate person in law. Some texts attempt to explain veil lifting by categories.

A company once duly incorporated becomes an artificial person that has a separate legal entity distinct from the people who constitute the company. Company law lifting of corporate veil 1 introduction when a company is incorporated it is treated as a separate legal entity distinct from its promoters directors members and employees. And hence the concept of the corporate veil separating those parties from the body has arisen. The locus classicus case of salomon v.

The veil of incorporation in law there is a metaphorical veil which conceals the incorporators members directors share holders debenture holders and other persons connected to a limited liability company. Consequently a company s liabilities are its own not those of its shareholders. Where the company is an agent of another where there is fraud or tax issues or employment issues or a group of com panies exists the courts will lift the veil. Iii veil of incorporation veil of incorporation or corporate veil is the legal assumption that the acts of a corporation are not the actions of its shareholders directors and managers so that they are exempt from liability for the corporation s actions 12 iv lifting or piercing the corporate veil.

Salomon is the judicial authority that enforces the legal personality of corporate entity especially when it has been incorporated. In adeyemi v lan and baker nig ltd the court held that there is nothing sacrosanct about the veil of incorporation. There is great reluctance by the. Reasons for lifting the veil of incorporation circumstances when the veil is lifted are haphazard and difficult to categorize.