Under the Companies Act, 2013, what is the term for conduct of the company's affairs by the controlling group that is burdensome, harsh and wrongful towards other shareholders in their capacity as…
Question and options
Under the Companies Act, 2013, what is the term for conduct of the company's affairs by the controlling group that is burdensome, harsh and wrongful towards other shareholders in their capacity as members?
Misfeasance
Fraudulent trading
Oppression
Mismanagement
Answer and explanation
Courts describe oppression, for which section 241 of the Companies Act, 2013 provides a remedy, as conduct that is burdensome, harsh and wrongful towards members in their capacity as members. Mismanagement is conduct prejudicial to the interests of the company itself, while misfeasance and fraudulent trading are breaches dealt with chiefly in winding up.
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