The provision relating to the liability of an independent director is laid down in sub-section (12) of Section 149 of the Companies Act, 2013, which mandates as under:
“(12) Notwithstanding anything contained in this Act,—
(i) an independent director;
(ii) a non-executive director not being promoter or key managerial personnel,
shall be held liable, only in respect of such acts of omission or commission by a company which had occurred with his knowledge, attributable through Board processes, and with his consent or connivance or where he had not acted diligently.”
Therefore, an independent director can be held liable, only in respect of such acts of omission or commission by a company-
(1) which had occurred with his knowledge, attributable through Board processes, and
(2) with his consent or connivance or where he had not acted diligently.
Dr. Ashok Dhamija is a New Delhi based Supreme Court Advocate and author of law books. Read more about him by clicking here. List of his Forum Replies. List of his other articles. List of his Quora Answers. List of his YouTube Videos.
.
