Case Law Analysis
|Bombay High Court
Section 179 Companies Act | Directors Cannot Bind Company Without Board Resolution in Property Sale: Bombay HC Sets Aside Injunction for Lack of Prima Facie Authority
Bombay High Court rules that directors lack inherent authority to bind a company in property transactions without a valid board resolution. Plaintiffs in specific performance suits must demonstrate both the director’s authority and their own readiness to perform to secure interim relief. The ruling reinforces corporate governance safeguards under the Companies Act, 2013, impacting shareholders, directors, and litigants in contract disputes.