TMI Blog1985 (3) TMI 218X X X X Extracts X X X X X X X X Extracts X X X X ..... tter, he is not even a shareholder of the company, and he is not concerned with the day-to-day work of the company. That the company seems to have exceeded its limits of borrowings. That on this position being ascertained, a meeting of the board of directors was held on February 4, 1983. At this meeting, a resolution came to be passed that an application should be made to the Central Government under section 58A of the Companies Act, 1956, seeking exemption concerning the excess deposit. That pending this application, the respondent issued two notices, both dated June 14, 1984, inter alia , calling upon the company to show cause why action should not be taken against the company and its officers for having accepted deposits exceeding the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of directors was held on February 4, 1983, and a decision was taken to make an application to the Central Government under section 58A so as to ensure that the requirement of the law were met with. That none the less from the attitude of the respondent, it appears that the respondent would take action against the petitioner holding him liable as "an officer in default", and it is in these circumstances that the petitioner has filed the present petition for relief under section 633 of the Companies Act. Mr. Bulchandani, the learned counsel for the respondent, urged that the petitioner is admittedly a director of the company. That he is deemed to know the day-to-day working of the company and cannot plead ignorance of facts. That admittedl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... company to which the petitioner was a party which allowed the company to make borrowings in excess of the limits or to point out any act of the petitioner wherein the petitioner had knowingly subscribed to the borrowings beyond the limits, or of the petitioner having wilfully authorised or permitted someone to borrow the monies in excess of the limits. Mr. Bulchandani was unable to point out a single act to satisfy this position or even indicate remotely as to how the petitioner could be said to be "an officer in default". In view of this discussion, what emanates is that whilst the company may be liable for breaches of the provisions of section 58A, there is no material placed before this court even to indicate as to how the petitioner ..... X X X X Extracts X X X X X X X X Extracts X X X X
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