Aveneu Park, Starling, Australia

Preliminary.Statement.for.Company.&.CorporationThe.word.”COMPANY”.is.derived.from.the.Latin.word.Com.mean.with/together.&.Panis.mean.bread..For.sake.of.understanding.we.say.that.itis.the.group.of.like-minded.persons.who.sit.together.for.earning.a.profit..In.past,.merchants.took.edge.of.festivals,.parties.&.gatherings.to.discuss.their.business.matters.seriously..Nowadays,.these.matters.of.profit.or.losebecome.formal.and.hence.cannot.be.discussed.in.gatherings…Therefore,.the.company.form.of.organizations.is.essential.and.need.which.we.have.today.It.denotes,.So,.company.denotes.an.association.of.likeminded.persons.formed.for.the.purpose.of.carrying.on.some.business.Company.is.called.a.body.corporate.because.the.persons.forming.it.made.him.one.body.by.incorporating.it.according.to.the.law.and.cover.it.with.legal.personality..The.word.”CORPORATION”.is.derived.from.the.Latin.term.Corpus.which.means.”body”…Accordingly,.corporation.is.a.legal.personincorporated.by.a.process.which.is.against.the.rules.of.natural.birth..It.is,.for.this.reason,.sometimes.called.artificial.legal.person.An.incorporated.company.owes.its.existence.either.to.a.special.Act.of.Parliament.or.to.Company.Law..Public.corporationshave.been.brought.into.existence.through.special.Acts.of.Parliament.like.Associated.Press.of.Pakistan.and.Civil.Aviation.Authority.etc..Whereas.companies.like.Attock.Refinery.Ltd..have.been.formed.under.the.Company.law.i.e..Companies.Act.2017.What.is.Company?In.the.legal.sense,.a.company.is.an.association.of.both.natural.and.artificial.persons.and.is.incorporated.under.the.existing.law.of.a.country..In.terms.of.theIn.common.law,.a.company.is.a.”legal.person.and.entity”.separate.from.its.members..Company.is.capable.of.surviving.its.life.other.thanthe.lives.of.its.members.Lord.Justice.Lindley.has.defined.a.company.as.”An.association.of.many.persons.who.contribute.money.or.money’s.worth.to.a.common.stock.and.employs.it.in.some.trade.or.business.and.who.share.the.profit.and.loss.arising.therefrom.The.persons.who.contributed.in.it.or.form.it,.or.to.whom.it.belongs,.are.members..The.proportion.of.capital.to.which.each.member.isentitled.is.his.share….According.to.the.best.of.my.knowledge,.I.defined.company.asAn.artificial.person.which.is.invisible,.intangible,.created.by.or.under.the.law.of.land.with.a.discrete.legal.entity,.perpetual.succession.and.a.common.seal..It.is.economic.and.administrative.structure.run.by.professional.managers.who.hire.capital.from.the.investors.Types.of.CompaniesDistinct.features.of.CompanySeparate.legal.entityAfter.incorporation,.a.company.becomes.a.separate.legal.entity.as.compared.to.its.members..The.company.is.different.from.its.members.in.law..It.has.its.own.name,.seal,.assets.and.liabilities.which.are.separate.from.its.members.Case.Law:.The.decision.of.the.case.in.Calcutta.High.Courtrecognized.the.principle.of.separate.legal.entity.even.much.earlier.than.the.decision.in.Salomon.v..Salomon.&.Co..Ltd..case.Limited.liabilityThe.company,.being.a.separate.person,.is.the.owner.of.its.assets.and.bound.by.its.liabilities.Members.are.neither.the.owners.of.the.company’s.undertakings,.nor.liable.for.its.debts.Perpetual.successionAn.incorporated.company.never.dies,.except.when.it.is.wound.up.as.per.law.or.the.task.for.which.it.was.formed.has.been.completed..Death.or.insolvency.of.members.does.not.affect.the.existence.of.the.company.Separate.propertyA.company.being.a.legal.person.and.entirely.distinct.from.its.members,.is.capable.of.owning,.enjoying.and.disposing.of.property.in.its.own.name.Transfer.of.sharesThe.capital.of.a.company.is.divided.into.parts,.called.shares..The.shares.are.said.to.be.movable.property.and,.subject.to.certain.conditions,.freely.transferable,.so.that.no.shareholder.is.permanently.or.necessarily.wedded.to.a.company..Common.sealA.company.is.an.artificial.person.&.contracts.made.by.him.must.be.under.the.seal.of.a.company.which.is.the.official.signature.of.the.company..The.name.of.company.must.be.engraved.on.the.common.seal..Any.document.not.bearing.the.seal.of.the.company.may.not.be.accepted.as.authentic.and.have.no.legal.force.Sue.and.be.suedA.company.can.sue.and.be.sued.in.its.own.name..To.sue.means.to.institute.legal.Proceedings.against.a.person.or.to.bring.a.suit.in.a.court.of.law..Similarly,.the.company.may.bring.an.action.against.anyone.in.its.own.name;.even.sue.one.of.its.own.members.Separate.managementA.company.is.managed.and.administered.by.the.board.of.directors..The.shareholders.are.simply.the.holders.of.the.shares.in.the.company.and.needed.not.be.necessarily.the.managers.of.the.company.What.is.Corporation?The.word.”CORPORATION”.is.derived.from.the.Latin.term.Corpus.which.means.”body”…Accordingly,.corporation.is.a.legal.person.created.by.a.process.other.than.natural.birth..It.is,.for.this.reason,.sometimes.called.artificial.legal.person..An.incorporated.company.owes.its.existence.either.to.a.special.Act.of.Parliament.or.to.Company.Law..In.the.legal.sense,.a.company.is.an.association.of.both.natural.and.artificial.persons.and.is.incorporated.under.the.existing.law.of.a.country.According.to.the.best.of.my.knowledge,.I.defined.corporation.asAn.association.of.persons.incorporated.according.to.the.relevant.law.and.clothed.with.legal.personality.separate.from.the.persons.constituting.it.is.known.as.corporation.Essence.of.corporationThe.Indian.Supreme.Court.laid.down.the.5.essence.of.corporation.in.a.famous.Characteristics.of.CorporationThe.five.core.structural.characteristics.of.the.business.corporation.are:-Legal.personalityLimited.liabilityTransferable.sharesCentralized.management.under.a.board.structureShared.ownership.by.contributors.of.capitalAs.we.can.study.these.characteristics.above.in.distinct.features.of.companythoroughly.so.there.is.no.such.need.to.explain.them.Saloman.Vs..Saloman.1897.A.C..22Saloman.had.a.sole.proprietor.business.of.a.leather.merchant..He.formed.a.company.on.his.name.Saloman&.Co..LTD..He.himself,.his.wife,.daughter.and.4.sons.are.members.of.this.company..The.wife,.daughter.and.4.sons.have.a.one.share.each..Saloman.sold.his.sole.proprietor.business.to.his.company.Saloman&.Co..LTD..&.obtained.20.thousand.shares.and.10.thousand.debentures..Debentures.were.secured.as.the.assets.of.Company.As.Saloman.act.as.director.of.his.company.so.he.borrowed.a.round.about.£6000.from.outside.creditors.on.which.security.is.not.given.to.them..After.company.suffered.from.heavy.losses.and.became.bankrupt..The.asset.of.Company.was.£7000.but.the.liabilities.are.nearly.£16000..As.a.result.company.was.wound.up.and.the.question.arose.that.whether.the.debentures.secured.on.assets.issued.to.Salomon.will.get.preference.against.the.other.debt.of.company..The.argument.brought.by.creditors.was.that.Salomon.and.Salomon.&.Co..LTD.is.same.person.so.he.should.be.payed.after.the.payment.of.outside.debtors.In.this.situation.court.held.that.Salomon.and.Salomon.&.Co..LTD.are.2.different.persons.and.Salomon.can.claim.to.be.a.secured.creditor.for.his.debentures..Therefore.proceeds.of.the.assets.should.be.first.allocated.to.settle.the.debentures.of.Salomon.Different.rules.established.in.Salomon.caseFollowing.are.the.rules.settled.in.Salomon.case.Recognition.of.family.owned.companies.Recognition.of.principal.of.separate.legal.entity.Recognition.of.members.limited.liability.Recognition.of.a.loan.to.company.given.by.a.member.of.it.Corporate.VeilThe.doctrine.in.Salomon’s.Case.creates.”thin.wafer.clothing”.on.the.company.due.to.which.no.one.can.access.that.what.&.who.is.behind.the.curtain.of.company.This.curtain.on.company.is.well.known.as.Veil.on.the.corporation.of.Company.OR.Veil.of.corporation..But.there.are.exceptions.under.which.court.ordered.to.break.this.veil.of.incorporation.Following.are.some.instances.when.court.pierces.this.veil.Company.is.agency.of.another.company./.Alter.ego.doctrineFraudSingle.economic.unitDetermination.of.residence.for.taxationDanger.to.national.security.and.many.more.Corporate.Veil.and.its.lifting:-Starting.with.a.juristic.perspective,.a.company.is.a.lawful.representative.unique.from.its.parts..It.is.held.in.famous.case.of.Salomon.v..Salomon.and.co..Ltd..(1897).discussed.above..This.standard.give.birth.a.principal.of.’Veil.on.incorporation’.which.create.a.narrative.cover.between.the.company..members..The.courts.by.and.large.think.about.themselves.certain.by.this.principal..But.in.certain.circumstances,.the.court.will.penetrate.the.corporate.cover.alternately.or.disregard.the.corporate.veil.to.reach.at.those.representatives.who.are.behind.this.cover.and.so.uncover.the.genuine.structure.of.company..The.justification.behind.this.is.likely.that.the.law.won’t.permit.the.corporate.structure.to.misused.and.make.the.society.abused.In.Littlewoods.Mail.Order.Stores.Ltd.V..Inland.Revenue.Comrs..Lord.Denning.stated:”The.doctrine.laid.down.in.Salomon.v..Salomon.and.Co.Ltd,.has.to.be.watched.very.carefully..It.has.often.been.supposed.to.cast.a.veil.over.the.personality.of.a.limited.liability.company.through.which.the.Courts.cannot.see..But,.that.is.not.true..The.Courts.can.and.often.do.draw.aside.the.veil..They.can.and.often.do,.pull.off.the.mask..They.look.to.see.what.really.lies.behind”.Comprehensively.there.are.two.sorts.for.procurements.for.the.lifting.of.the.corporate.veil..Legal.procurements.OR.we.say.judicial.provisions..Judicial.provisions.discussed.about.fraud,.character.of.company,.protection.of.revenue,.single.economic.entity..Same.time.statutory.procurements.or.provisions.discussed.about.decrease.in.membership,.Misdescription.of.name,.fake.conduct.of.business,.Failure.to.refund.application.money.and.so.on.Judicial.lifting.of.corporateveil:-Since.the.decision.in.Salomon.v…Salomon.&.Co..Ltd..(1897),.generally.courts.are.very.reluctant.and.cautious.to.lift.the.corporate.veilto.see.the.real.personalities.behind.the.scene..For.many.years.the.judiciary.swings.his.face.from.strict.principles.of.the.Salomon,.Lee.&MacCuara.case.but.in.famous.case.of.United.States.V..Milwaukee.Refrigerator.Co.,.it.was.summed.up.that:”A.corporation.will.be.looked.upon.as.a.legal.entity.as.a.general.rule.but.when.the.tool.of.legal.entity.is.used.to.defeat.public.convenience,.justify.wrong,.protect.fraud.or.defend.crime,.the.law.will.regard.the.corporation.as.an.association.of.persons.which.is.opposite.which.held.in.Salomon,.Lee.&MacCuara.case.”Following.are.the.situations.when.court.thinks.that.it.deems.fit.to.uplift.the.corporate.veil.over.the.company:-Fraud,.duplicity.or.inappropriate.Conduct:-Where.the.corporate.veil.has.been.used.for.commission.of.fraud.or.improper.conduct..In.such.a.situation,.Courts.have.lifted.the.veil.and.looked.at.the.realities.of.the.situation.The.Courts.won’t.permit.the.Salomon.vital.will.utilized.as.a.motor.for.cheating..Courts.will.lift.the.veil.on.the.registered.company.to.make.sure.that.corporation.prevents.to.use.device.of.fraudulent.purposes.or.evading.a.contractual.obligation.or.liability.For.Benefit.Of.Revenue:-The.Court.has.the.power.to.checkout.thecompany.if.it.is.used.for.the.purpose.of.tax.evasion.or.prevents.from.his.tax.obligations..Where.it.was.found.that.the.sole.purpose.for.which.the.company.was.formed.was.to.evade.taxes.the.Court.will.ignore.the.concept.of.separate.entity.and.make.the.individuals.concerned.liable.to.pay.the.taxes.which.they.would.have.paid.but.for.the.formation.of.the.company.Case.LawBrief.facts.of.the.case.are.that.the.assesse.might.have.been.a.rich.wealthy.man.enjoying.immense.profit.and.investment.wage..He.shaped.four.private.companies.and.suitably.for.each.should.hold.a.block.of.investment.and.agenize.to.it..Money.accepted.might.have.been.credited.in.the.accounts.of.the.particular.company.yet.the.agency.gave.back.the.amount.to.him.as.a.pretended.loan..This.way.he.divided.his.income.into.four.parts.in.a.bid.to.reduce.his.tax.liability.Foe/Enemy.Character:-A.company.might.an.adversary.character.when.persons.of.foe.characters.accepted.control.of.its.undertakings.over.a.foe.nation..In.such.a.case,.court.might.analyze.the.character.of.persons.in.genuine.control.of.the.company,.and.announce.the.company.to.a.chance.to.be.an.enemy.agency.Company.avoiding.lawful.Obligations:-.The.place.the.utilization.of.a.consolidated.company.is,.no.doubt.aggravated.will.evade.legitimate.obligations,.the.court.might.neglect.those.legitimate.personalities.of.the.particular.company.and.proceed.on.the.supposition.that.no.company.existed.Abusedcorporate.personality&.public.interests:-Where.it.is.found.that.a.company.has.abused.itscorporate.personality.for.an.unjust.and.inequitable.purpose,.the.court.would.not.hesitate.to.lift.the.corporate.veil..Further,.the.corporate.veil.could.belifted..when..acts..of..a..corporation..are..allegedly..opposed..to..justice,..convenience..and..interests..of.revenue.or.workmen.or.are.against.public.interest.SINGLE.ECONOMIC.ENTITY:-Sometimes.in.the.case.of.group.of.enterprises.the.Salomon.principal.may.not.be.adhered.to.and.the.Court.may.lift.the.veil.in.order.to.look.at.the.economic.realities.of.the.group.itself.Statutory carrying on of the business in

Preliminary.Statement.for.Company.&.CorporationThe.word.”COMPANY”.is.derived.from.the.Latin.word.Com.mean.with/together.&.Panis.mean.bread..For.sake.of.understanding.we.say.that.itis.the.group.of.like-minded.persons.who.sit.together.for.earning.a.profit..In.past,.merchants.took.edge.of.festivals,.parties.&.gatherings.to.discuss.their.business.matters.seriously..Nowadays,.these.matters.of.profit.or.losebecome.formal.and.hence.cannot.be.discussed.in.gatherings…Therefore,.the.company.form.of.organizations.is.essential.and.need.which.we.have.today.It.denotes,.So,.company.denotes.an.association.of.likeminded.persons.formed.for.the.purpose.of.carrying.on.some.business.Company.is.called.a.body.corporate.because.the.persons.forming.it.made.him.one.body.by.incorporating.it.according.to.the.law.and.cover.it.with.legal.personality..The.word.”CORPORATION”.is.derived.from.the.Latin.term.Corpus.which.means.”body”…Accordingly,.corporation.is.a.legal.personincorporated.by.a.process.which.is.against.the.rules.of.natural.birth..It.is,.for.this.reason,.sometimes.called.artificial.legal.person.An.incorporated.company.owes.its.existence.either.to.a.special.Act.of.Parliament.or.to.Company.Law..Public.corporationshave.been.brought.into.existence.through.special.Acts.of.Parliament.like.Associated.Press.of.Pakistan.and.Civil.Aviation.Authority.etc..Whereas.companies.like.Attock.Refinery.Ltd..have.been.formed.under.the.Company.law.i.e..Companies.Act.2017.What.is.Company?In.the.legal.sense,.a.company.is.an.association.of.both.natural.and.artificial.persons.and.is.incorporated.under.the.existing.law.of.a.country..In.terms.of.theIn.common.law,.a.company.is.a.”legal.person.and.entity”.separate.from.its.members..Company.is.capable.of.surviving.its.life.other.thanthe.lives.of.its.members.Lord.Justice.Lindley.has.defined.a.company.as.”An.association.of.many.persons.who.contribute.money.or.money’s.worth.to.a.common.stock.and.employs.it.in.some.trade.or.business.and.who.share.the.profit.and.loss.arising.therefrom.The.persons.who.contributed.in.it.or.form.it,.or.to.whom.it.belongs,.are.members..The.proportion.of.capital.to.which.each.member.isentitled.is.his.share….According.to.the.best.of.my.knowledge,.I.defined.company.asAn.artificial.person.which.is.invisible,.intangible,.created.by.or.under.the.law.of.land.with.a.discrete.legal.entity,.perpetual.succession.and.a.common.seal..It.is.economic.and.administrative.structure.run.by.professional.managers.who.hire.capital.from.the.investors.Types.of.CompaniesDistinct.features.of.CompanySeparate.legal.entityAfter.incorporation,.a.company.becomes.a.separate.legal.entity.as.compared.to.its.members..The.company.is.different.from.its.members.in.law..It.has.its.own.name,.seal,.assets.and.liabilities.which.are.separate.from.its.members.Case.Law:.The.decision.of.the.case.in.Calcutta.High.Courtrecognized.the.principle.of.separate.legal.entity.even.much.earlier.than.the.decision.in.Salomon.v..Salomon.&.Co..Ltd..case.Limited.liabilityThe.company,.being.a.separate.person,.is.the.owner.of.its.assets.and.bound.by.its.liabilities.Members.are.neither.the.owners.of.the.company’s.undertakings,.nor.liable.for.its.debts.Perpetual.successionAn.incorporated.company.never.dies,.except.when.it.is.wound.up.as.per.law.or.the.task.for.which.it.was.formed.has.been.completed..Death.or.insolvency.of.members.does.not.affect.the.existence.of.the.company.Separate.propertyA.company.being.a.legal.person.and.entirely.distinct.from.its.members,.is.capable.of.owning,.enjoying.and.disposing.of.property.in.its.own.name.Transfer.of.sharesThe.capital.of.a.company.is.divided.into.parts,.called.shares..The.shares.are.said.to.be.movable.property.and,.subject.to.certain.conditions,.freely.transferable,.so.that.no.shareholder.is.permanently.or.necessarily.wedded.to.a.company..Common.sealA.company.is.an.artificial.person.&.contracts.made.by.him.must.be.under.the.seal.of.a.company.which.is.the.official.signature.of.the.company..The.name.of.company.must.be.engraved.on.the.common.seal..Any.document.not.bearing.the.seal.of.the.company.may.not.be.accepted.as.authentic.and.have.no.legal.force.Sue.and.be.suedA.company.can.sue.and.be.sued.in.its.own.name..To.sue.means.to.institute.legal.Proceedings.against.a.person.or.to.bring.a.suit.in.a.court.of.law..Similarly,.the.company.may.bring.an.action.against.anyone.in.its.own.name;.even.sue.one.of.its.own.members.Separate.managementA.company.is.managed.and.administered.by.the.board.of.directors..The.shareholders.are.simply.the.holders.of.the.shares.in.the.company.and.needed.not.be.necessarily.the.managers.of.the.company.What.is.Corporation?The.word.”CORPORATION”.is.derived.from.the.Latin.term.Corpus.which.means.”body”…Accordingly,.corporation.is.a.legal.person.created.by.a.process.other.than.natural.birth..It.is,.for.this.reason,.sometimes.called.artificial.legal.person..An.incorporated.company.owes.its.existence.either.to.a.special.Act.of.Parliament.or.to.Company.Law..In.the.legal.sense,.a.company.is.an.association.of.both.natural.and.artificial.persons.and.is.incorporated.under.the.existing.law.of.a.country.According.to.the.best.of.my.knowledge,.I.defined.corporation.asAn.association.of.persons.incorporated.according.to.the.relevant.law.and.clothed.with.legal.personality.separate.from.the.persons.constituting.it.is.known.as.corporation.Essence.of.corporationThe.Indian.Supreme.Court.laid.down.the.5.essence.of.corporation.in.a.famous.Characteristics.of.CorporationThe.five.core.structural.characteristics.of.the.business.corporation.are:-Legal.personalityLimited.liabilityTransferable.sharesCentralized.management.under.a.board.structureShared.ownership.by.contributors.of.capitalAs.we.can.study.these.characteristics.above.in.distinct.features.of.companythoroughly.so.there.is.no.such.need.to.explain.them.Saloman.Vs..Saloman.1897.A.C..22Saloman.had.a.sole.proprietor.business.of.a.leather.merchant..He.formed.a.company.on.his.name.Saloman&.Co..LTD..He.himself,.his.wife,.daughter.and.4.sons.are.members.of.this.company..The.wife,.daughter.and.4.sons.have.a.one.share.each..Saloman.sold.his.sole.proprietor.business.to.his.company.Saloman&.Co..LTD..&.obtained.20.thousand.shares.and.10.thousand.debentures..Debentures.were.secured.as.the.assets.of.Company.As.Saloman.act.as.director.of.his.company.so.he.borrowed.a.round.about.£6000.from.outside.creditors.on.which.security.is.not.given.to.them..After.company.suffered.from.heavy.losses.and.became.bankrupt..The.asset.of.Company.was.£7000.but.the.liabilities.are.nearly.£16000..As.a.result.company.was.wound.up.and.the.question.arose.that.whether.the.debentures.secured.on.assets.issued.to.Salomon.will.get.preference.against.the.other.debt.of.company..The.argument.brought.by.creditors.was.that.Salomon.and.Salomon.&.Co..LTD.is.same.person.so.he.should.be.payed.after.the.payment.of.outside.debtors.In.this.situation.court.held.that.Salomon.and.Salomon.&.Co..LTD.are.2.different.persons.and.Salomon.can.claim.to.be.a.secured.creditor.for.his.debentures..Therefore.proceeds.of.the.assets.should.be.first.allocated.to.settle.the.debentures.of.Salomon.Different.rules.established.in.Salomon.caseFollowing.are.the.rules.settled.in.Salomon.case.Recognition.of.family.owned.companies.Recognition.of.principal.of.separate.legal.entity.Recognition.of.members.limited.liability.Recognition.of.a.loan.to.company.given.by.a.member.of.it.Corporate.VeilThe.doctrine.in.Salomon’s.Case.creates.”thin.wafer.clothing”.on.the.company.due.to.which.no.one.can.access.that.what.&.who.is.behind.the.curtain.of.company.This.curtain.on.company.is.well.known.as.Veil.on.the.corporation.of.Company.OR.Veil.of.corporation..But.there.are.exceptions.under.which.court.ordered.to.break.this.veil.of.incorporation.Following.are.some.instances.when.court.pierces.this.veil.Company.is.agency.of.another.company./.Alter.ego.doctrineFraudSingle.economic.unitDetermination.of.residence.for.taxationDanger.to.national.security.and.many.more.Corporate.Veil.and.its.lifting:-Starting.with.a.juristic.perspective,.a.company.is.a.lawful.representative.unique.from.its.parts..It.is.held.in.famous.case.of.Salomon.v..Salomon.and.co..Ltd..(1897).discussed.above..This.standard.give.birth.a.principal.of.’Veil.on.incorporation’.which.create.a.narrative.cover.between.the.company..members..The.courts.by.and.large.think.about.themselves.certain.by.this.principal..But.in.certain.circumstances,.the.court.will.penetrate.the.corporate.cover.alternately.or.disregard.the.corporate.veil.to.reach.at.those.representatives.who.are.behind.this.cover.and.so.uncover.the.genuine.structure.of.company..The.justification.behind.this.is.likely.that.the.law.won’t.permit.the.corporate.structure.to.misused.and.make.the.society.abused.In.Littlewoods.Mail.Order.Stores.Ltd.V..Inland.Revenue.Comrs..Lord.Denning.stated:”The.doctrine.laid.down.in.Salomon.v..Salomon.and.Co.Ltd,.has.to.be.watched.very.carefully..It.has.often.been.supposed.to.cast.a.veil.over.the.personality.of.a.limited.liability.company.through.which.the.Courts.cannot.see..But,.that.is.not.true..The.Courts.can.and.often.do.draw.aside.the.veil..They.can.and.often.do,.pull.off.the.mask..They.look.to.see.what.really.lies.behind”.Comprehensively.there.are.two.sorts.for.procurements.for.the.lifting.of.the.corporate.veil..Legal.procurements.OR.we.say.judicial.provisions..Judicial.provisions.discussed.about.fraud,.character.of.company,.protection.of.revenue,.single.economic.entity..Same.time.statutory.procurements.or.provisions.discussed.about.decrease.in.membership,.Misdescription.of.name,.fake.conduct.of.business,.Failure.to.refund.application.money.and.so.on.Judicial.lifting.of.corporateveil:-Since.the.decision.in.Salomon.v…Salomon.&.Co..Ltd..(1897),.generally.courts.are.very.reluctant.and.cautious.to.lift.the.corporate.veilto.see.the.real.personalities.behind.the.scene..For.many.years.the.judiciary.swings.his.face.from.strict.principles.of.the.Salomon,.Lee.&MacCuara.case.but.in.famous.case.of.United.States.V..Milwaukee.Refrigerator.Co.,.it.was.summed.up.that:”A.corporation.will.be.looked.upon.as.a.legal.entity.as.a.general.rule.but.when.the.tool.of.legal.entity.is.used.to.defeat.public.convenience,.justify.wrong,.protect.fraud.or.defend.crime,.the.law.will.regard.the.corporation.as.an.association.of.persons.which.is.opposite.which.held.in.Salomon,.Lee.&MacCuara.case.”Following.are.the.situations.when.court.thinks.that.it.deems.fit.to.uplift.the.corporate.veil.over.the.company:-Fraud,.duplicity.or.inappropriate.Conduct:-Where.the.corporate.veil.has.been.used.for.commission.of.fraud.or.improper.conduct..In.such.a.situation,.Courts.have.lifted.the.veil.and.looked.at.the.realities.of.the.situation.The.Courts.won’t.permit.the.Salomon.vital.will.utilized.as.a.motor.for.cheating..Courts.will.lift.the.veil.on.the.registered.company.to.make.sure.that.corporation.prevents.to.use.device.of.fraudulent.purposes.or.evading.a.contractual.obligation.or.liability.For.Benefit.Of.Revenue:-The.Court.has.the.power.to.checkout.thecompany.if.it.is.used.for.the.purpose.of.tax.evasion.or.prevents.from.his.tax.obligations..Where.it.was.found.that.the.sole.purpose.for.which.the.company.was.formed.was.to.evade.taxes.the.Court.will.ignore.the.concept.of.separate.entity.and.make.the.individuals.concerned.liable.to.pay.the.taxes.which.they.would.have.paid.but.for.the.formation.of.the.company.Case.LawBrief.facts.of.the.case.are.that.the.assesse.might.have.been.a.rich.wealthy.man.enjoying.immense.profit.and.investment.wage..He.shaped.four.private.companies.and.suitably.for.each.should.hold.a.block.of.investment.and.agenize.to.it..Money.accepted.might.have.been.credited.in.the.accounts.of.the.particular.company.yet.the.agency.gave.back.the.amount.to.him.as.a.pretended.loan..This.way.he.divided.his.income.into.four.parts.in.a.bid.to.reduce.his.tax.liability.Foe/Enemy.Character:-A.company.might.an.adversary.character.when.persons.of.foe.characters.accepted.control.of.its.undertakings.over.a.foe.nation..In.such.a.case,.court.might.analyze.the.character.of.persons.in.genuine.control.of.the.company,.and.announce.the.company.to.a.chance.to.be.an.enemy.agency.Company.avoiding.lawful.Obligations:-.The.place.the.utilization.of.a.consolidated.company.is,.no.doubt.aggravated.will.evade.legitimate.obligations,.the.court.might.neglect.those.legitimate.personalities.of.the.particular.company.and.proceed.on.the.supposition.that.no.company.existed.Abusedcorporate.personality&.public.interests:-Where.it.is.found.that.a.company.has.abused.itscorporate.personality.for.an.unjust.and.inequitable.purpose,.the.court.would.not.hesitate.to.lift.the.corporate.veil..Further,.the.corporate.veil.could.belifted..when..acts..of..a..corporation..are..allegedly..opposed..to..justice,..convenience..and..interests..of.revenue.or.workmen.or.are.against.public.interest.SINGLE.ECONOMIC.ENTITY:-Sometimes.in.the.case.of.group.of.enterprises.the.Salomon.principal.may.not.be.adhered.to.and.the.Court.may.lift.the.veil.in.order.to.look.at.the.economic.realities.of.the.group.itself.Statutory lifting of corporateveil:-Following are the situations when statute permits that it deems fit to uplift the corporate veil over the company:-Reduction of number of members:-According to Sec 15& 301(e) of Pakistan Companies Act 2017, there is aliability of uplifting the corporate veil for carrying on business with less than three or, in the case of a private company, two members.A company may be wound up by the Court, if  the  number  of  members  is  reduced,  in  the  case  of  public company, below three and in the case of a private  company below two.Fraudulent Trading:-According to Sec 301(g)(i) & 398 of Pakistan Companies Act 2017,a company may be wound up by the Courtif the company is conceived or brought forth for, or is or has been carrying on, unlawful or fraudulent activities. Also, if any business of a company is carried on with the intent to defraud creditors of the company or creditors of any other person or for any fraudulent purpose, who was Knowingly a party to the carrying on of the business in that manner is liable to imprisonment or fine or both.Conceal name of creditor:-According to Sec 95 of Pakistan Companies Act 2017, there is a penalty of uplifting veil on concealment of name of creditor. If any officer of the company conceals the name of any creditor entitled to object to the reduction, or willfully misrepresents  the  nature  or  amount  of  the  debt  or  claim  of  any creditor,  or  if  any  officer  of  the  company  abets  any  such  concealment  or misrepresentation  as  aforesaid,  every  such  officer  shall  be  punishable with imprisonment for a term which may extend to one year, or with fine which may extend to five million rupees, or with both.Misdescription of company:-According to Sec 24(2) of Pakistan Companies Act 2017, If a company does not display its name in the manner provided for by this Act, and also on bill of exchange, promissory note, endorsement, cheque or order for money or goods in which the companies name is not mentioned in legible letters, it shall be liable to a penalty not exceeding level 1 on the standard scale and every officer of the company who authorizes or permits the default shall be liable to the like penalty.Failure to conduct Annual General Meetings:-According to Sec 301(c) of Pakistan Companies Act 2017, a company may be wound up by the Court if default is made in holding any two consecutive annual general meetings.Refund application money:-According to Sec 68(2) of Pakistan Companies Act 2017, if the repayments of money received for shares application are not allotted then court uplift the veil on company.If the refundrequired is not made within the time specified, the directors of the company shall be jointly and severally liable to repay that money with surcharge at the rate of two percent for every month or part  thereof  from  the  expiration  of  the  fifteenth  day  and,  in  addition,  shall  be liable to a penalty of level 3 on the standard scale.Premature trading:-According to Sec 20 of Pakistan Companies Act 2017, the consequences of non-compliance of section 19 i.e. commencement of business by a public company is uplifting the veil of company. Under this segment, a state funded restricted company recently consolidated all things considered must not “do business or exercise whatever obtaining power” until it need got starting with the registrarofcompanies. If it enters into any transaction contrary to this provision not only are the company and its officers in default, liable to pay fines but if the company fails to comply with its obligations in that connection within 21 days of being called upon to do so, the directors of the company are jointly and severally liable to indemnify the other party in respect of any loss or damage suffered by reason of the company’s failure.Relationship.between.Uplifting.of.veil.&.Tort:-A.finding.of.tortious.liability.against.a.shareholder.for.activities.carried.out.through.the.medium.of.a.company.has.the.possibility.of.negating.the.Salomon.principle.i.e..uplifting.the.veil.on.company..The.courts.have.increasingly.been.faced.with.this.possibility.Concluding.Remarks:-The.act.of.piercing.the.corporate.veil.until.now.remains.one.of.the.most.controversial.subjects.in.corporate.law..There.are.classes.for.example.fraud,.agency,.sham.or.facade,.shamefulness.and.group.enterprises,.which.are.accepted.particular.support.under.which.the.Judiciary.and.statute.might.penetrate.in.the.corporate.cover.

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