Lifting of Corporate Veil free essay sample

Lifting or Piercing the Corporate Veil is a Legal process or proceedings taken to uncover the common shield in respect of any suspicious event happened or to be happened or on the basis of allegation made or to be made against the Company. This piercing process can be compared to a person lifting the curtain of a Drama Stage to know what is actually happening without being the drama commenced. Piercing the Corporate Veil is a Premeditated process with an intention to curtail the unfair advantage enjoyed on forming of a Company. Merits on Incorporating a Company. Incorporating a Company is always preferred by active entrepreneurs than commencing a Partnership firm or sometimes a sole proprietorship. The major boons of incorporating a Company are: 1. Limited Liability. Almost all the Companies are started with limited liability status. A Company with Limited Liability indicates that a Members’ loss in a Company is only up to the value of his shares or loan made, if any thing unfortunate happens to the Corporate. We will write a custom essay sample on Lifting of Corporate Veil or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page The Personal Assets or earnings of Director or the Officer will never be put at risk. But if the event is a fraud or anything outside the purview of the Memorandum of Association (which means â€Å"Ultra Vires†) the Directors or â€Å"Officers in Default† {Section 5 of Companies Act} will be held for Personal Liability. 2. Protection of Name: The Company’s name will be protected immediately once it is approved by â€Å"Registrar of Companies† (herein after called as â€Å"ROC†). There will be no chance of another Company being started with the same name or even identical to the Companies Name. Whilst in the case of a Partnership Firm or Sole Proprietorship Concern, the name can be only protected by a Trademark Registration. 3. Existence. As an old proverb indicates, â€Å"Members may come and go, but the Company exists forever† is the gist of the Company formation. The Company will disappear only after the complicated winding up and liquidation process under the Specific order from Registrar of Companies or any other appropriate authority. 4. Raising Funds: There are not too many better options otherwise than incorporating the Company to raise funds for expansion of the markets for its products, commencing a new business, enter into a global market etc. Initially a Company will be floated as a Private Company (with a limit of 50 shareholders) and after rooting its base in the market, it may proceed with an Initial Public Offer to become a Public Company and gets listed in the Stock Exchange within 21 days of the closure of Public Offer (Usual Routine). A Company can also raise loan on its assets by creating a Charge (Fixed or Fluctuating) in favour of a Bank (Secured Creditor after Charge is being created) which is a very simple process done through MCA portal where the ROC is intimated by filing Form-8. 5. Taxation Benefits. The Taxation part is the most fruitful of all the benefits enjoyed by the Company. The Company’s liability for tax when compared to partnership firms and sole proprietorship concern is very limited. A corporate is blessed with so many deductions and other tax allowances which can be charged against the profits of the Company which limits the liability to pay tax. When Companies began to show Nil Total Income after their tax planning, Section 115JB was introduced in the Income Tax Act vide Finance Bill 2002, which articulates Minimum Alternate Tax whereby a minimum tax obligation was put on the Company which is charged against their Book Profits. Rising of Lifting the Corporate Veil concept. Any Company incorporated under the Companies Act, 1956, can enjoy all the fruits and permitted to do all the acts under the Laws of the land. But if the Companies start to get pleasure from other undue benefits prejudicial to the corporate habitat, the Lifting of Corporate of Veil concepts come into the picture. 1. Regular Company Law formalities are not followed. The Companies are required to abide with certain compliance formalities such as convening of Board Meetings and General Meetings, Filing of Balance Sheets with the RoC, filing Income Tax Return etc. When these regular formalities are not met or complied invariably, with/without any reason, legal actions may be initiated for piercing the corporate veil. 2. Disinvestment and Diversion of Funds. On some occasions directors may on their discretion, having the controlling stake may opt to disinvest or divert the funds without intimating the Shareholders. Such disinvestments or diversion of funds may adversely affect the financial stability of the Company in general and the interests of the stake holders in specific which invites the court to pierce the corporate veil of the Company. 3. Seasonal Non Payment/Excessive Payment of Dividend. Non payment or excessive payment of dividend to the shareholders may sometimes bring suspicions on other stakeholders or legal/governmental authorities for which lifting corporate veil proceedings get attracted. 4. Alter Ego concept. The Company being blessed with so many merits, will be floated and all regularities will be done at the initial stages so as to make it appear as an active company. But later, the alter ego of the Directors gradually starts visible and will occupy the driver’s seat of the company. When it is felt that there are some discrepancies being done placing Company as a shadow/mask, lifting corporate veil of the Company becomes indispensable. 5. Fraudulent Motive. When the judiciary feels that when there is any fraudulent activities are going on in a Company or there is a chance such malpractices, the Court has all the powers to pierce the corporate veil. 6. Enemy Character. At any time, if any Country has become the alien enemy (War has been declared against another Company), the Court has the authority to pierce the corporate veil so as to analyze the Shareholding and other management and fiduciary interests of the Alien Company in that Company to protect the General Interests. 7. Tax Regulation. If any tax legislation insists the appropriate authority to pierce the Corporate Veil, the Court would not mind the Separate Legal personality of the Company and proceed with digging the core of the formation and other commotions of that Company. Some Celebrated Case Laws related with Lifting the Corporate Veil of the Company: 1. Salomon Vs Salomon (1897) In this case, Mr. Saloman was dealing with shoe business. The Kingdom of Britain then enacted a statute providing for the incorporation of businesses and a corporation then had to have at least seven shareholders. Mr. Salomon formed a corporation, with all seven shareholders being members of his family. The business of the corporation eventually went under, leaving considerable unpaid debts and ever branching liabilities. The creditors argued in court that the shareholders should be liable for the debts of the corporation, because they were all related to Old Man Salomon, and that the corporation was set up a mere sham. The court held in favour of the shareholders, Old Man Salomons relatives. The fact that the shareholders were all related to Old Man Salomon was irrelevant in determining that the corporation legitimately existed as a separate entity, and thus the individual shareholders were not held liable for the corporations debts. This case law in a narrow aspect does not have any relevance with regard to Piercing Corporate Veil concept. But this judgment was taken as a trump card to taste the cream of formation of Companies. 2. Gilford Motor Company Vs Horne: In this case, the Court disregarded the judgment of Salomon Vs Salomon, questioning the distinct legal personality of a Company. Mr. Horne was an ex-employee of Gilford Motor Company and as per the terms of the employment, he should not solicit any of the Company’s customers. In order to defeat this provision, Mr. Horne incorporated a Company in his wife’s name and solicited all the customers for which the Company brought up action against him. The Court analyzed the motive of incorporating the limited Company and it was ipso facto found that the Company’s main purpose was to perpetrate the fraud. 3. Jones Vs Lipman This case is similar to Gilford Motor Company Vs. Horne. Here, Lipman entered into contract with Jones to sell his land. Later, Lipman changed his mind and transferred the property to a Company in order to avoid Specific Performance. But it was held that the Company as well as the transfer of property was only acting as a mask to avoid recognition by the eye of equity. 4. Edwards Company Inc Vs Monogram Company Inc: Monogram Industries acquired Entronic Corporation in the field of production of smoke detectors. Monogram made its purchases through its wholly owned subsidiary name Monotronics. Monotronics then entered a Limited Liability Partnership with Entronic Company and acted as a General Partner. In the course of the business, Edwards Inc granted loan worth $ 350,000 to Entronic Corporation which it could not ply went the market slashed. However, Monotronics, being a General Partner could repay a part of the loan worth $ 10,000 from its estate to Edwards Company. But, Edwards filed a suit against Monogram Industries for the recovery of the debt against Entronics, an attempt to pierce its corporate veil on the basis of the following grounds: a. The Board of Directors, Office and Contact numbers of Monotronics and Monograms are same. b. Monotronics was only a piece of paper or a dummy company as far as Monograms is concerned. But, the Honourable Court analyzed that: 1. There was nothing to prove or insist the court to order for lifting the corporate veil as there was no fraudulent act or injustice shown from the Company/Companies to escape from the liabilities. 2. There was no lack of separate existence of the 2 Companies. 3. There was no violation of any corporate formalities. 4. There was also no co-mingling of money and under capitalization in both the Companies. Taking in view of the above analysis, the Court quashed the suit filed by Edwards Company against the Monogram Group. Conclusion: It is always fruitful for active and vibrant entrepreneurs to expose their skills and respond to the changing environment by incorporating a Company. The Incorporation of such a corporate must be in the true spirit of law. Once the Company is floated, in spite of enjoying all the merits, it also has to comply with all the procedural and legal formalities. A Director of a Company must be also aware of Section 322 of Companies Act, 1956 which makes their liability unlimited. In the Era of Corporate Governance and Corporate Social Responsibility, the chance for lifting the Corporate Veil may not arise, but there are cases of â€Å"Fly by Night Entrepreneurs† and â€Å"Vanishing Companies† after the Initial Public Offer even after SEBI has framed vide variety of Guidelines for protecting investors and other stakeholders. In Taxation words, this can be compared with Tax Planning and Tax Evasion where the essence depends upon the intention of the assessee whether to apply all the loopholes available in the law or by pass the boundaries for unjust enrichment.

Author Scams and Publishing Companies to Avoid

Author Scams and Publishing Companies to Avoid Authors Beware: Scams and Publishing Companies to Avoid Becoming a published author is a fantasy shared by almost all writers. And as with almost any widely-shared ambition, there are also folks out there looking to make a quick buck by exploiting those dreams - whether they involve securing a book deal or going the indie publishing route.The publishing world has its fair share of scammers and disreputable companies. At Reedsy, we regularly hear from authors who, despite being well-informed and educated people, have fallen prey to these scammers. In this post, we’ll take a closer look at common writers scams and show you how to identify the publishing companies to avoid on your journey to publication.If you are wondering about the legitimacy of a certain company, leave us a comment below or drop us a line at service@reedsy.com.  We'll get back to you right away. Authors beware! Do you know the most common publishing scams? Vanity Pressesâ€Å"Oh, my! There’s a publisher who wants to release my book!†Not all publishers are created equal. For every Random House, there is some guy in a random house, convincing authors that they hold the key to publishing success. But before you sign on the dotted line, stop for a second and ask yourself and look at what they’re offering. What is a vanity press and why are they bad? Most reputable publishers share the same business model: the publisher acquires the rights to publish and distribute the book by paying the author an advance. The publisher will then cover the costs of editorial, design, and marketing. Once the book is published, the author will receive a royalty of every copy sold (after the author’s total royalties have covered the advance).

UNIT 5 Essay Example | Topics and Well Written Essays - 500 words - 1

UNIT 5 - Essay Example When management carries out its duties effectively by attaining desired results, then that defines doing things the right way. On the other hand, when management does things efficiently, that is accomplishing set goals in the required way, then that is doing the right thing. Setting measurable goals such as budgets and production levels gives the manager a chance to analyze reasons for missing certain goals. Reasonable and measurable goals help managers to expose reasons that results into struggles of working staff. In addition, measurable goals help in preventing miscommunication among members of the organization. Without measurable goals, employees morale decreases because staff members feel that they work without direction. It, therefore, is through setting up of measurable goals that employees prove to their managers their worth and goals. Every project goal has its critical dimensions. Three of these critical dimensions include cost, scope and schedule of the project in question. For any project, the manager must put into consideration cost of materials that the entire project may require. Secondly, the required release date of the project makes it necessary for a manager to treat schedule with significance (Sanzo et al.,  2012). Finally, project managers also need to take care of the project scope. Project scope involves performance requirements and any other set features in the project goal. The most common types of project manager’s charts are the PERT Chart and Gantt chart. Both PERT and Gantt charts help managers to plan their projects in a manner that enables the project team to visualize the project as a whole or in part (Bowen, 2014). However, PERT and Gantt display varied contrasts. Gantt charts describe tasks dependencies, onset and ending times for project tasks while PERT charts describe parallel activities and that are sequential. Gantt charts mainly depict simple related tasks whereas PERT charts focus on

Red Star The First Bolshevic Utopia is a dystopia rather than a utopia Essay

Red Star The First Bolshevic Utopia is a dystopia rather than a utopia because martian people exploited all their planets's resouces and planned to erradicate and colonize on another planet - Essay Example In addition, the novel is radical in nature in that, it shows how readers of utopia may consider a success; yet do not understand what the author meant (Aldridge 23-24). The red star written in 1905, at that time, socialism had already existed for several years in Mars in that, the inhabitants of Mars had sent expeditions to earth with the hopes of creating contacts between the two civilizations. It is interesting to note that the Martians feared cementing their relationship with people from the earth, so they decided to find earthling with good advanced and flexible constitution to hijack and take them back to Mars in order to acquaint him with the Martian civilization and culture, and at the end, return him to earth as their emissary. Their emissary, Leonid is convinced of the significance of the mission for which the Martians have picked him and on his expedition, he learns the Martians culture and history. While touring the schools, factories, museums and research institutions of Mars, Leonid is convinced that the Martian people were superior to those people on earth. He is convinced of the superiority of socialism over the capitalism that still reigns on Earth (Bognadov 16-18). The tour of Mars is used to express the maturity of socialist society including advanced science, planned economy and collectivism. Further, Leonid realizes that in Mars, there is no distinction between sexes. During his stay in Mars, Leonid realized that the Martian people do not harbor good intentions towards his native planet in contrary to what he thought. The Martian people planned an invasion of the Earth and extermination of its people in order to exploit their natural resources. The red star is used to represent the Russian workers with visible model for their revolutionary strivings. On the other hand, in Mars, at first glance, it does not appear to be a socialist utopia in that, most of the objectives of the Europeans has been accomplished

God and Philosophy Essay Example for Free

God and Philosophy Essay Many philosophers will say that God plays an important role in a persons mental being. Others will argue that he doesnt and that we decide by our own mentality. The three thinkers that will be discussed in this paper made a large impact in the philosophical world with their theories and reasons. Descartes, Kant, and Hume are all important players in the world of philosophy, but according to other philosophers, so is God. Rene Descartes, a noted French philosopher, scientist, and mathematician, coined the Latin phrase Cogito ergo sum (I think, therefore I am). He refused to accept the scholastic and Aristotelian traditions that had dominated philosophical thought throughout the medieval period (www. iep. utm. edu). He frequently contrasted his views with those of his predecessors. In his theology, he insists on the absolute freedom of Gods act of creation. In 1641, he wrote Mediations on First Philosophy, which he employed a method called methodological skepticism; where he doubts any idea that can be doubted. God, in Descartes metaphysics, is the bridge from the subjective world of thought to the objective world of scientific truth. The mind, owing its existence to God, is innately programmed with certain ideas that correspond to reality; hence the importance, in Descartes system, of proving the existence of God, the perfect guarantor of our ideas, so that the mediator can move from isolated flashes of cognition to systematic knowledge of the nature of reality (Cottingham, 31). In Meditations, he mentions the idea of a benevolent God. Because God is benevolent, he can have some faith in the account of reality his senses provide with a working mind and sensory system and does not desire to deceive him; however, this is a continuous argument, as his very notion of a benevolent God from which he developed this argument is easily subject to the same kind of doubt as his perceptions (www. wikipedia. com). Descartes sought to retain the belief in the existence of innate ideas together with an acceptance of the values of data and ideas derived from an experience. Next up is Immanuel Kant, a German philosopher that held that there is an objective moral law. Most philosophers view morality very differently. Some think there is an objective moral law, but that it depends on Gods will. Others thought morality was to do with reason, but that the reasoning was all about how to promote some objective, like ones own happiness of welfare of society (Walker, 5). Kant rejected these ideas, because morality is depending on something outside itself- Gods will. Kant inquired whether it could be possible to ground synthetic ? a priori knowledge for a study of metaphysics, because most of the principles of metaphysics from Plato through Kants immediate predecessors made assertions about the world or about God or about the soul. Kants works of 1755 reveal more of his originality and his enduring themes. Universal Natural History, deriving the present state of the planets from postulated initial conditions by reiterated applications of the laws of Newtonian mechanics, manifests not only Kants commitment to those laws, for which he was subsequently to seek philosophical foundations, but also his commitment to thoroughly naturalistic explanations in science, in which God can be the initial source of natural laws but never intervenes within the sequence of physical causes. Kant still holds that the existence of God can be proved as a condition of the possibility of any reality. Finally, Kant further develops his argument that scientific explanation cannot allow divine intervention in the sequence of events, and that God must be seen only as the original ground of the laws of nature. The existence of God is therefore to Kant a necessary assumption for what he sees to be an objectively valid morality. Lastly, David Hume, British philosopher, is considered one of the most influential religious philosophers. Hume questioned the process of inductive thinking, which had been the hallmark of science. He criticized the standard proofs for Gods existence, traditional notions of Gods nature and divine governance, the connection between morality and religion, and the rationality of belief in miracles. He also advanced theories on the origin of popular religious beliefs, grounding such notions in human psychology rather than in rational argument or divine revelation. For Hume, all objects of human reason are divided into two kinds: Relations of Ideas and Matters of fact. All reasoning of matters of fact is founded on Cause and Effect. Cause and Effect play a big role in Humes philosophy. Hume wrote The Natural History of Religion in 1757. Its main theme is the causes and consequences of the religious development of mankind from polytheism to monotheism. Belief in a god or gods is not natural like belief in an external world, since there are races in which it is not to be found (Quinton, 52). Contrary to many critiques Hume does believe that there is a God, however he does not believe that God is all greatness like society commonly assumes and accepts. Hume argues that because one sees an effect that doesnt mean that we can automatically know or assume its cause. This argument can be used to explain the creation of the world. As influential as Hume was, he remains an academic skeptic, making the reasonable judgments of an ordinary life, regardless of lack of academic knowledge. God played an important role in every philosophers thinking. They either tried to provide proof that he does or does not exist, or tried to decipher why so many people followed a man whom they have never even met. Nevertheless, God played an important role in Kants, Descartes, and Humes philosophical thinking. Works Cited Burnham, Douglas and James Fieser. Rene Descartes (1596-1650). The Internet Encyclopedia of Philosophy. 2005. http://www. iep. utm. edu/d/descarte. htm. Cottingham, John. Descartes. New York, Rutledge: 1999. Quinton, Anthony. Hume. New York, Rutledge: 1999. Rene Descartes. http://en. wikipedia. org/wiki/Descartes. Walker, Ralph. Kant. New York, Rutledge: 1999.

Louis Armstrong Essay -- essays research papers fc

Louis Armstrong's Influential Career Louis Armstrong’s Influential Career Louis Armstrong was the most successful and talented jazz musician in history. His influence and expansive career continues to make waves in the jazz world. That is what made him become what he is to many today – a legend. Born on August 4, 1901, in the poorest section of New Orleans, Armstrong grew up with his grandparents due to his parents’ separation. On January 1, 1913 he made a mistake which turned out to be the best thing that ever happened to him. At a New Year’s celebration in downtown New Orleans, Louis Armstrong, also known as â€Å"Satchmo† and â€Å"Satch†, fired a pistol into the air and was placed in the Colored Waifs’ Home. It was there that he was introduced to Peter Davis – the brass band leader who taught him how to play the cornet (Brown 17). Soon after he began playing, Armstrong was made leader of the band – something he was extremely proud of. In June of 1914, Ar mstrong was free to leave the Waifs’ Home. He was hired by various cabarets throughout the city, as well as for picnics, dances, and funerals. It was at one of these places that he was spotted by the famous Joe ‘King’ Oliver. King Oliver found Armstrong stand-in slots at orchestras and other venues. In 1918, he was offered the vacant seat left by Oliver in the band the Brown Skinned Babies. Kid Ory, leader of the band, once said that after Louis joined them he, â€Å"†¦improved so fast it was amazing. He had a wonderful ear and a wonderful memory. All you had to do was hum or whistle a new tune to him and he’d know it right away† (Boujut 21). At the end of 1918 Armstrong married Daisy Parker, a prostitute he had met at a dance hall that he played on Saturday nights. The marriage ended only four years later due to her beating him regularly (Bergreen 87). Louis Armstrong was hired in May of 1919 to play on a riverboat that traveled the Mississipp i River from New Orleans to St. Louis. Armstrong soon became very popular in St. Louis and was in high demand (Collier 124). Two and a half years later, he was thrown off the riverboat and fired due to a fight. After returning to New Orleans, he received a telegram from King Oliver in Chicago. It was an invitation to join The Creole Jazz Band – an offer Armstrong couldn’t refuse. The Jazz Band cut it’s first record in the spring of 1923 and toured throughout Illinois, Ohio,... ...s he starred in which shared the same title. For the next seven years of his life he was in and out of the hospital due to heart and kidney problems. On July 6th, 1971, Louis Armstrong died of a lung infection and heart complications. His last wish, that his trumpet be buried with him, was granted. Louis Armstrong influenced almost all aspects of jazz technique and style. He was the first to improvise and elaborate on a given melody. This technique has since been attempted and copied time and time again. Armstrong introduced a freedom to music that continues to impact popular music (Sadie 601). Without this American genius music would not be what it is today. Bibliography Works Cited Bergreen, Lawrence. Louis Armstrong: An Extravagant Life. New York: Broadway, 1997. Boujut, Michel. Louis Armstrong. New York: Rizzoli, 1998. Brown, Sandford. Louis Armstrong. New York: Watts, 1993. Collier, James Lincoln. Louis Armstrong: An American Genius. New York: Oxford, 1983. Crouch, Stanley. â€Å"Louis Armstrong.† Time 8 Aug. 1998: 170. Sadie, Stanley. ed. â€Å"Louis Armstrong.† The New Grove Dictionary of Music and Musicians. 6th ed. Vol. 1. New York: Macmillan, 1995. Word Count: 1246

Explain the Biological Mechanisms by Which Stress Can Induce Depressive Behaviour

Explain the biological mechanisms by which stress can induce depressive behaviour. Introduction Depressive behaviour is a core feature of several major psychological disorders, most obviously major depression (MD) and depressive episodes of bipolar depression (BP). Depression is also frequently found to be co-morbid with psychotic disorders such as schizophrenia and with anxiety-related disorders (e. g. social phobia or OCD). Depression is the biggest major risk factor for self-harm and suicide, thus posing a real clinical problem to try to understand and reverse the mechanisms involved.Traditional anti-depressant treatment has only shown a modest benefit to placebos in treating the disorder; therefore, more effective drugs that target the right biological mechanisms are imminently needed. The majority of experimental research in the area has used rodents to test medication and model known psychopathological aspects of depression in humans, such as learned helplessness, cognitive def icits and increased co-morbidity with anxiety-related behaviours. There are many factors that may explain why some people (around 16% of the population) will experience a depressive episode in their lifetime and others won’t.Genetic vulnerability and epigenetic changes, psychosocial support, socioeconomic status or even climate-related factors all have to be considered in considering the right treatment for individual cases. Whilst the causal link between many of these and the onset of depression is somewhat inconclusive, the strong association between chronic mild stress (CMS) and depressive behaviour is now a huge area of research, resulting in the stress-induced model of depression.Even where there is evidence for the role of genes in depression, such as allele variants for the 5-HTT promoter region, it is shown to vary as a function of exposure to stressful life events. The mechanisms by which environmental stressors can lead to depressive behaviour have been explored tho roughly, with a strong focus on the role of the Hypothalamus-Pituitary-Adrenal (HPA) axis and its dysfunction in depression. The consequent rise in levels of the glucocorticoid hormone cortisol, following HPA activation, has been shown to become chronic increased in depressed patients.This is thought to be due to the development of glucocorticoid resistance, whereby high levels of cortisol are present in the bloodstream and peripheral tissue but negative feedback to shut down the HPA axis no longer works. Due to the numerous roles of cortisol within the body, several biological processes may be affected as a consequence of CMS that may lead to depressive behaviour. Direct and indirect effects of HPA dysfunction include changes in immune response, neuronal damage, decreased rates of neurogenesis and the serotonin pathways.These processes tend to interact and exacerbate one another; therefore, understanding each proposed biological mechanism of stress-induced depression and their impa ct upon each other is likely to lead to a better treatment outcome. Acute Stress and the HPA Axis The experience of acute mild stress is a normal and adaptive process, triggered by an environmental ‘stressor’ deemed to be potentially harmful. From an evolutionary perspective, this serves to protect the individual from danger via activation of the sympathetic nervous system, preparing the individual for ‘fight or flight’ mode.Stress, as well as input from the amygdala, hippocampus and midbrain, directly activates the ‘stress response’ via the Hypothalamic-Pituitary-Adrenal (HPA) axis. The first immediate response is the release of corticotrophin releasing hormone (CRH) from the hypothalamus, which travels to the pituitary where it binds to CRH Receptor 1 (CRHR1). CRH can also act directly on other brain regions, e. g. the amygdala at this early stage. CRH1 activation stimulates the release of adrenocorticotrophin release hormone (ACTH), which tr avels via the bloodstream to the kidneys, stimulating the delayed release of the glucocorticoid (steroid) cortisol.Cortisol acts throughout the body in all cells, via binding to cytoplasmic glucocorticoid and mineralocorticoid receptors (GR and MR) (see Figure 1). Figure 1: Cortisol can pass through the cell membrane due to its lipophillic properties. Binding of cortisol to the GR complex in the cytoplasm causes dissociation of GR from the complex, resulting in an active GR monomer. Two GRs then dimerise to form a GR dimer. This can act as a transcription factor in itself by attaching to Glucocorticoid Binding Elements (GBE), or it can interact with other Hormone Binding Elements and transcription factors to initiate gene transcription. http://jimlund. org/blog/? m=200910] A rise in cortisol levels, alongside CRH, leads to adaptive changes in behaviour, cognition and immune function. Importantly, this rise is followed by a negative feedback loop of cortisol and CRH acting upon its o wn receptors (NC3R1 and CHR2, respectively) to shut down the HPA axis once the ‘threat’ has been resolved. This homeostatic mechanism terminates the production of any more CRH and therefore brings cortisol levels back to baseline (pre-stressor), vital for returning the individual back to a normal ‘resting’ state.It is this negative feedback mechanism which has been shown to be disrupted in patients with depression. Chronic Stress and Glucocorticoid Resistance In a situation of CMS, the prolonged activation of the HPA axis leads to abnormally elevated cortisol levels. However, chronically elevated cortisol can be dangerous, due to its role in suppressing the immune system and increasing vulnerability to infection. It is possible that in order to counteract the constant influx of circulating cortisol causing potentially unwanted downstream effects, GRs in lymphocytes become unresponsive or resistant to glucocorticoids.This dysfunction of GRs is typically seen in depressed patients and has been shown numerous times using the dexamethasone suppression test (DST). Dexamethasone (a synthetic glucocorticoid) mimics cortisol by binding to GRs and shutting down HPA activity in healthy controls. Therefore, dexamethasone-treated individuals have almost no detectable cortisol over the course of the following day. On the other hand, in depressed patients, the DST doesn’t show any significant repression of HPA activity.Whilst they already show significantly higher overall levels of cortisol, they also show reduced suppression of dexamethasone during the DST. This shows that the GRs are unresponsive to glucocorticoids, leading to the typical feature of glucocorticoid resistance in depressed patients. The Inflammation/Cytokine Hypothesis Glucocorticoid resistance has important implications for immune system function. Under normal acute stress, cortisol suppresses lymphocytes in peripheral tissue from producing pro-inflammatory cytokines by act ivating intracellular GRs and leading to transcription of downstream regulatory genes.Key targets of GR-mediated transcription related to immune function include the upregulation of anti-inflammatory genes annexin-1, IL-10 and I? B? (inhibits NF-? B) and down-regulation of pro-inflammatory cytokine genes, such as IL1-6, 9, 11-13, 16-18 and TNF-?. However, glucocorticoid resistance following chronic stress can mean that lymphocytes stop responding to cortisol, so there is an increase in the proliferation of leukocytes and production of pro-inflammatory cytokines.The proposed mechanism for how these peripherally-generated cytokines are able to affect the central nervous system (CNS) involves several pathways. These cytokines (IL-1? , TNF-? and IL-6) cannot typically diffuse across the blood-brain-barrier, but they can enter the CNS in regions of high BBB permeability or be actively transported across the BBB by endothelial cell transporters. Additionally, without crossing the BBB, cyt okines are able to activate endothelial cells to produce soluble factors (e. g.PG-E2) to indirectly activate neurons, as well as activating certain afferent neurons (e. g. the vagus nerve) that carry information to the CNS about the inflammation. In these ways, peripheral inflammation can cause typical changes in the CNS and ‘sickness behaviour’ seen in depressed patients: lethargy, anhedonia, reduced locomotor activity and sleep and weight disturbances. Support for this proposed mechanism comes from findings that clinically depressed patients show an abnormally high production of pro-inflammatory cytokines (IL-1? IL-6 and TNF-? ), cytokine-based immunotherapy often causes depression in cancer or hepatitis C patients and cytokine administration causes depressive behaviour in animal models. Reversal of this depressive behaviour can be seen by administration of anti-depressants, which target and reduce the inflammatory response in both patients and animal models. In a sim ilar fashion, anti-inflammatories such as cyclooxygenase (COX)-2 inhibitors or omega-3 have strong anti-depressant effects on behaviour. Inflammation-Induced NeurodegenerationAnother approach to modelling stress-induced depression has focused on the controversial findings of clinically depressed patients show changes in volume of structural brain regions, including the hippocampus, amygdala, anterior cingulated, prefrontal cortex and basal ganglia. The mechanisms by which some brain regions, in particular the hippocampus as implicated in stress-induced depression, might decrease in volume appear to be a combination of both neurodegeneration (increased apoptosis of neurons) and a decrease in adult neurogenesis in the subgranular zone of the dentate gyrus (DG).Stress-induced HPA hyper-activity may explain the atrophy seen in some brain regions of clinically depressed patients. Glucocorticoids stimulate the breakdown of tissue into glucose for the quick release of energy; therefore, ch ronically increased levels may result in brain tissue loss in regions where cortisol acts, such as the hippocampus. Furthermore, the link between stress, inflammation and an increase in oxidative stress may also explain a large portion of the neurodegeneration apparent in depression.Inflammation has been shown to increase oxidation and the fact that the CNS has no proper defence against oxidative damage makes it very vulnerable to oxidative stress (OS). This has been demonstrated as a key feature in neurodegenerative diseases and depression, implicating a causal role of stress-induced inflammation in triggering degeneration. The damage caused by OS can lead to mitochondrial dysfunction, which can lead to further intracellular build up of damaging oxidised proteins.The only way for cells to cope in this situation is to activate programmed cell death (apoptosis), or in less controlled circumstances, necrosis can occur, leading to a decline in cell numbers and lateral effects on the ne ural network. This mechanism of oxidative stress-induced neurodegeneration can be slowed down and treated by the application of antioxidant enzymes, which serve a neuro-protective role. These enzymes eradicate free radical oxidising particles and also suppress pro-inflammatory cytokine action.A further damaging feature seen in neurodegeneration and depression is nitrosative stress (NS), which may contribute to neurotoxicity and therefore cell death. An increase in the production of cortisol after acute stress will temporarily cause a suppression of neurogenesis in the DG. Neurogenesis in the DG has been demonstrated to be vital for healthy cognition and memory, impacting mood, the sleep-wake cycle and appetite; all affected in depression. Therefore, CMS leads to prolonged suppression of neurogenesis and may explain the behavioural outcomes typical of depression.The decrease in neurogenesis following exposure to stress may possibly involve the neurotrophin Brain Derived Neurotrophic Factor (BDNF), shown to be greatly reduced in regions that also show a decrease in neurogenesis and related to brain regions typically affected in depression. Animal models exposed to CMS show decreased neurogenesis and BDNF levels in overlapping brain regions and elicit depressive behaviours associated with dysfunction of these regions. Furthermore, anti-depressant treatment that successfully increases BDNF levels also leads to recovery from depressive behavioural symptoms.However, the causation here is not clear; whether the BDNF levels dropping are a result of other stress-induced mechanisms or whether it is partly the cause of the behaviour. Some evidence suggests that anti-depressants can work independently of BDNF restoration. Hagen and colleagues set out to control for possible variables such as age, time of cortisol readings and overall brain volume. Whilst there has been no robust evidence for a link between baseline cortisol levels and hippocampal volume, this study did fi nd that hippocampal volume was negatively correlated with length of depressive episode pre-hospitalisation.Furthermore, better responsiveness (lowering of cortisol levels) after treatment was predicted by greater hippocampal volume (relative to overall brain volume). b) antineurogenic effects and reduced brain-derived neurotrophic factor (BDNF) levels; and c) apoptosis with reduced levels of Bcl-2 and BAG1 (Bcl-2 associated athanogene 1), and increased levels of caspase-3. Stress-induced inflammation, e. g. increased IL-1? , but not reduced neurogenesis, is sufficient to cause depression. Antidepressants a) reduce peripheral and central inflammatory pathways by decreasing IL-1? TNF? and IL-6 levels; b) stimulate neuronal differentiation, synaptic plasticity, axonal growth and regeneration through stimulatory effects on the expression of different neurotrophic factors, e. g. trkB, the receptor for brain-derived neurotrophic factor; and c) attenuate apoptotic pathways by activating Bc l-2 and Bcl-xl proteins, and suppressing caspase-3. It is concluded that external stressors may provoke depression-like behaviours through activation of inflammatory, oxidative, apoptotic and antineurogenic mechanisms.The clinical efficacy of antidepressants may be ascribed to their ability to reverse these different pathways. Neuronal damage and apoptosis Activation of the Kynurenine Pathway (KP) 5-HT Accumulated evidence indicates a role of the hippocampal 5-hydroxy-tryptamine (5-HT) and neuropeptide Y (NPY) in the response to stress and modulation of depression, but it is unclear whether and how the hippocampal 5-HT and NPY systems make contributions to chronic unpredicted mild stress (CUMS)-induced depression.Here we observed that rats receiving a variety of chronic unpredictable mild stressors for 3 weeks showed a variety of depression-like behavioral changes, including a significant reduction in body weight, sucrose preference, and locomotion, rearing and grooming in open fiel d test, and a significant increase in immobility time in forced swimming test. These CUMS-induced behavioral changes were suppressed or blocked by intra-hippocampal injection of 5-HT (31. 25 microg/microl) or NPY (10 microg/microl). These data suggest a critical role of reduced hippocampal 5-HT and NPY neurotransmission in CUMS-induced depression.