In situations where it is determined that a company's application under section 248 was made with the intention of evading liabilities, deceiving creditors, or defrauding others, what are the consequences for the individuals managing the company?

Solution

Companies Act Section 251. Fraudulent application for removal of name: (1) Where it is found that an application by a company  under sub-section (2) of section 248 has been made with the object of evading the liabilities of the company or with the intention to deceive the creditors or to defraud any other persons, the persons in charge of the management of the company shall, notwithstanding that the company has been notified as dissolved— (a) be jointly and severally liable to any person or persons who had incurred loss or damage as a result of the company being notified as dissolved; and (b) be punishable for fraud in the manner as provided in section 447.