Liability of a Director
4 years ago
I have been made director of a pvt ltd co. in 2018 which was incorporated in 2016. I do not have any shares on my name. Now my company is taking a loan from bank for which even I will need to sign on legal documents of bank. If my company defaults payment, will I be liable for the payment of debt? If yes, to what extent?
Banerjee Law Chambers. Prodyut Banerjee- Advocate
Responded 4 years ago
A.The answer is clearly no. You will not be held personally responsible until and unless you have given any personal guarantee/ indemnity. Here Comes the concept "Company is a separate Legal entity". However if the loan is taken for a fraudulent purpose the Corporate veil shall be lifted to see your involvement in the transaction.
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Shreyash Mohta
Responded 4 years ago
A.YES
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A.Dear Sir,
Normally each Director will be held liable for repayment of loan, be careful before signing the documents.
Normally each Director will be held liable for repayment of loan, be careful before signing the documents.
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Suneel Moudgil
Responded 4 years ago
A.Yes, you would be equally responsible for payment of debt
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