2.2.2 Doctrine of Indoor Management
According to the Doctrine of Indoor Management, the persons dealing with the company need not inquire whether internal proceedings relating to the contract are followed correctly, once they are satisfied that the transaction is in accordance with the memorandum and articles of association.
The doctrine helps protect external members from the company and states that the people are entitled to presume that internal proceedings are as per documents submitted with the Registrar of Companies.The rule of Doctrine of Indoor Management is conflicting to that of the principle of Constructive Notice.The Doctrine of Indoor Management lays down that persons dealing with a company having satisfied themselves that the
In such a case the plaintiff cannot sue the company unless the power has, in fact, been delegated to the officer with whom he dealt. A clear illustration is AnandBehariLal v Dinshaw[18] here the plaintiff accepted a transfer of a company’s property from its accountant. Since such a transaction is apparently beyond the scope of an accountant’s authority’ it was void. Not even a ‘delegation clause’ in the articles could have validated it, unless he was, in fact,
a) special provision b) special resolution
c) resolution d) dissolution
2) Therule of Doctrine of Indoor Management is conflicting to that of the principle of _______________.
a) Constructive Notice b) Doctrine of Outdoor Management
c) Turquand Rule d) Article 39
3) The origin of the Doctrinerule had its genesis in the case of __________ vTurquand.
a) Royal Bank of Scotland b) Swiss Bank
c) Royal Bank d) ZBW
4) The first and the most obvious restriction is that the rule has no application where the party affected by ____________ had actual notice of it.
a) Regularity b) an irregularity
c) loss d) liability
5) ____________may in circumstances exclude the ‘Turquand Rule’.
a) Loss b) Forgery
c) Regularity d) Suspicion of regularity

2.2.3 Shares, Debentures, Dividends and Transfer and Transmission of