A company commits an offence under section 138 of the Negotiable Instruments Act, 1881. Subject to the…
Section 141(1) looks to the director’s role at the time of the offence. The first proviso allows the person to prove lack of knowledge or that they exercised all due…
Choose your answer
A company commits an offence under section 138 of the Negotiable Instruments Act, 1881. Subject to the provisos to section 141(1), which circumstance can make a director liable under that subsection?
Answer and explanation
Correct answer A
Section 141(1) looks to the director’s role at the time of the offence. The first proviso allows the person to prove lack of knowledge or that they exercised all due diligence to prevent the offence.
Option feedback
Option A
The subsection looks to both charge of the business and responsibility to the company at the time of the offence.
Option B
Share ownership alone does not establish charge of or responsibility for conducting the business.
Option C
Joining after the offence cannot establish the relevant role at the time of the offence.
Option D
Holding office without responsibility for conducting the business does not meet the stated test.
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