National law university odisha corporate law I national law university odisha
Chloro Controls India v. Severn Trent Water Purification
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- Life Insurance Corporation of India v. Escorts
- Balwant Rai Saluja v. Air India 35and Arcelor Mittal India v. Satish Kumar Gupta
| Chloro Controls India v. Severn Trent Water Purification 33 Hence, only in the case of composite transactions, the non-signatory group companies were held to be bound. The decision of Mahanagar case, the court held that the non-signatory group companies are bound by arbitration agreements in an increased number of fact situations, in addition to composite transactions. The doctrine of piercing the corporate veil is another means by which courts have sought to determine liability in the context of layered corporate structures. In substance, the doctrine permits a court to disregard the separate character of a company to discover its shareholders and impose liability inappropriate cases.” ” The SC in the case of Life Insurance Corporation of India v. Escorts 34 , held that, only if contemplated by statute or in the cases where the corporate identity can be used to protect a fraud, the veil of different identity between a company and its shareholders maybe lifted. Also, while giving the aforesaid grounds for lifting the corporate veil, the court held that it is 32 Mahanagar Telephone Nigam v Canara Bank AIR 2019 SC 4449. 33 Chloro Controls India v Severn Trent Water Purification (2013) 1 SCC 64. 34 Life Insurance Corporation of India v Escorts (1986) 1 SCC 264. NATIONAL LAW UNIVERSITY ODISHA CORPORATE LAW Ii neither necessary nor desirable to enumerate the classes of cases where lifting the veil is permissible, since that must necessarily depend on the relevant statutory or other provisions, the object sought to be achieved, the impugned conduct, the involvement of the element of the public interest, the effect on parties who maybe affected, etc. The Court therefore contemplated enumeration of further circumstances where the lifting of the corporate veil would be justified. The SC following the directions in the Escorts Case widened the grounds to lift the corporate veil in Balwant Rai Saluja v. Air India 35 and Arcelor Mittal India v. Satish Kumar Gupta 36 The ratios in these cases most importantly diluted the earlier standing making it necessary to be a case of fraud or statutory requirement for piercing of the veil. It was held as a proposition of law that the corporate veil maybe pierced when separate corporate identity is employed to obscure liability for improper conduct Therefore, on the basis of the above mentioned cases, it can be observed that there has been an uncertainty and inconsistency in the approach of the CCI while dealing with the issues of single economic entity and such application differs on a case to case basis. In light to the cases that have been decided by the Court, in the application of this doctrine, these factors seem to hold prime significance and consideration Download 0.88 Mb. Share with your friends:
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