Blacklisting

Shivesh Tripathi (Querist) 09 January 2016 This query is : Resolved
if an entity is being blacklisted, is it possible that a shareholder without getting any show cause notice individually be barred/ blacklisted automatically?

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Devajyoti Barman (Expert) 09 January 2016
The company is blacklisted and not the share holder in individual capacity.
The show cause is mostly ot served before the blacklisting and even if it is done the notice is sent to company address only.

Shivesh Tripathi (Querist) 09 January 2016
thank you Mr. Devajyoti Barman. it will be very nice of you if you could tell me this more elaborately, and is there any case law saying the same. please tell me if there are any.

Guest (Expert) 09 January 2016
Academic query without description of real problem and background!

Shivesh Tripathi (Querist) 09 January 2016
Mr. Dhingra i will provide here real problem.
a SPV which has 4 shareholders got blocklisted SPV was served with show cause notice. Then my question is can these 4 shareholder be blacklisted for the act of the SPV, without even getting show cause notice individually?

Devajyoti Barman (Expert) 10 January 2016
No, the share holders in individual capacity would not be blacklisted.

Rajendra K Goyal (Expert) 10 January 2016
What is SPV and what was the constitution of the SPV? Shareholders of company / LLP can not be blacklisted if the entity is blacklisted.

Dr J C Vashista (Expert) 10 January 2016
1. An academic query.
2. In a limited company laibility of shareholder is limited to the extent of his/her share and not beyond, which is not applicable in the instant case/ circumstances i.e., blacklisting company has no affect on the shareholder except loss of goodwill, bonus, divident and price of share in the (share) market.

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