SC Decision on Disproportionate Share Allotment: Applicability of Section 81 of Companies Act 1956

Hasmukhlal Madhavlal Patel And Anr. Vs Ambika Food Products Pvt. Ltd. And Ors. (Supreme Court of India) Supreme Court of India’s decision in the case of Hasmukhlal Madhavlal Patel And Anr. vs Ambika Food Products Pvt. Ltd. And Ors., focuses on the issue of disproportionate allotment of shares in a right issue by a private limited company. Supreme court examines the applicability of Section 81 of the Companies Act, 1956 and analyzes the directors’ duty and responsibilities in such cases. This decision though reiterates the principles laid down earlier in Dale & Carrington and N...