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Separate Legal Entity : Meaning and Case Laws

Separate Legal Entity / Separate Legal Personality

With the incorporation of a Company as per the law in force, it becomes a Separate legal entity, meaning an entity which has a distinct identity from its owners (ie. shareholders). 

A company as referred above must be an registered company, meaning it must have been registered as a company under the companies act 2013 or under any other previous law. Generally, a limited liability company enjoys the distinction of separate legal entity.

The Company is an Artificial Independent Person in the eyes of law represented by the Board of Directors.

In the past there have been many deliberations on this matter including cases in the Court of Law be it local or in foreign countries.

One of the mostly learned worldwide discussed case law is 'Salomon v. A. Salomon & Co. Ltd. (1897) AC 22'.

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