Business Ethics and Corporate Governance, Second Edition

LIABILITY FOR BREACH OF STATUTORY DUTIES

Directors should carry out several statutory duties most of which relate to the maintenance of proper accounts, filing of returns or observance of certain statutory formalities. If they fail to perform these duties, they render themselves liable to penalties.

The Companies Act imposes penalty upon directors for not complying with or contravening the provisions of the Act, which include sections on criminal liability for mis-statements in prospectus, penalty for fraudulently inducing persons to invest money, purchase by a company of its own shares, concealment of names of creditors entitled to object to reduction of capital, penatly for default in filing with the Registrar for registration of the particulars ...