My business partner is misusing company funds in Gorakhpur — what legal action can I take?
CH Asked by Charu Singhal from India
Quick Answer
Misuse of company funds by a director or partner is actionable under the Companies Act, 2013 (for companies) or the Indian Penal Code for criminal breach of trust and cheating.
Detailed Legal Analysis
Misuse of company funds by a director or partner is actionable under the Companies Act, 2013 (for companies) or the Indian Penal Code for criminal breach of trust and cheating. You can file a petition for oppression and mismanagement under Sections 241–242 before the National Company Law Tribunal (NCLT), and criminal complaints before the magistrate in Gorakhpur.
Appeals from NCLT lie before the National Company Law Appellate Tribunal and the Allahabad High Court under Section 61. Operational compliance in Uttar Pradesh also requires Shops and Establishments registration under Uttar Pradesh Rent Control Act 1972 for the premises.
A forensic audit and interim relief may be sought. Document the misuse with financial records before initiating action.
Legal Provisions Referenced
Verify the current statutory text at India Code (the official repository of Indian legislation) or the Legislative Department. This answer is general legal information, not advice on your specific matter.
Disclaimer: AI-generated for educational purposes only. Does not constitute legal advice. Consult a qualified practitioner.