Describe the legal status of a promoter.

Explanation

The company law has not given any legal status to promoters. A promoter is neither an agent nor a trustee of the company because it is a non entity before incorporation. Some legal cases have tried to specify the status of a promoter. He stands in a fiduciary position. The promoter moulds and creates the company and under his supervision it comes into existence. It is the duty of the promoter to get maximum benefits for the company. He should not get secret profits from the company. If he sells his property to company, then he should explain his interest in such property.