Case List: Loss of Substratum

In determining whether or not the substratum of the company has gone, the objects of the company and the case of the company on that question will have to be looked into. The Court will consider whether the company has abandoned its objects of business. The mere fact that the company has suffered, trading losses will not destroy its substratum unless there is no reasonable prospect of it ever making a profit in the future.


  • Madhusudan Gordhandas & Co. vs. Madhu Wollen Industries Pvt. Ltd.,  (1971) 3 SCC 632 (para 30)

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