Can director be arrested for company cheque Karachi?
Professional Advocates in Karachi
I was talking to a fellow lawyer from Lahore the other day and a legal topic came up – directors’ liability – I’m not a big fan of the law on that matter. The lawyers I know all know the ‘old boys’ argument’ about companies having a right to borrow on their shareholders’ faith and on the basis of a loan contract signed by themselves or company directors. In this case, directors sign a company’s loan agreement on its behalf, giving them full and unconditional authority over the loan’s performance.
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Civil Law Firm Karachi
A question has raised, why not the company? Does it not have a board of directors? Is it not the duty of a company director to sign his name to the cheque? I am a lawyer, not a lawyer from the law firm Karachi, but if a cheque is drawn by a company or any legal entity, should not the directors of the company be also arrested for this act? I am sure that any person in his right senses will say yes, but this is what happened in a case, the board of directors of a company
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Licensed Lawyers in Pakistan
“Certainly, Director’s criminal responsibility may be challenged, not to mention arrested, in a company’s cheque Karachi in case the company directors do not provide a clear explanation or a timely answer in response to a cheque, with regard to payments made by shareholders, to other creditors, to suppliers, or to third parties. Such action is possible under Section 409 of the Pakistan Penal Code, specifically 409A, which provides for criminal penalties for non-fulfillment of liability-