Section 378T: Liability of directors
This section is for imposing liability on directors of a Producer Company for any loss or damage caused by their actions in contravention of the law or company articles.
The section, clause by clause
What the section says
In plain terms
(1)When the directors vote for a resolution, or approve by any other means, anything done in contravention of the provisions of this Act or any other law for the time being in force or articles, they shall be jointly and severally liable to make good any loss or damage suffered by the Producer Company.
Directors are jointly and severally liable to make good any loss or damage suffered by the Producer Company if they vote for or approve anything done in contravention of the Act or other laws or articles.
(2)Without prejudice to the provisions contained in sub-section (1), the Producer Company shall have the right to recover from its director—
The Producer Company can recover from a director any profit made by the director as a result of a contravention, or an amount equal to the loss or damage incurred by the company as a result of the contravention.
(2)(a)where such director has made any profit as a result of the contravention specified in sub-section (1), an amount equal to the profit so made;
(2)(b)where the Producer Company incurred a loss or damage as a result of the contravention specified in sub-section (1), an amount equal to that loss or damage.
(3)The liability imposed under this section shall be in addition to and not in derogation of a liability imposed on a director under this Act or any other law for the time being in force.
The liability imposed on directors under this section is in addition to any other liability imposed on them under the Act or other laws.
The right-hand column is written from the section text, not quoted from it, and it has no legal force. Where the two differ, the left-hand column is the law.
Search the whole Act, or ask it a question, in the interactive browser.
Reproduced from the official India Code print for reference. Check the current text on India Code before you rely on it, and read the section alongside its Rules. Nothing here is legal advice.