| Case ID |
175b90af-31a1-4366-81c6-1e0e2dbb12d5 |
| Body |
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| Case Number |
Appeal No. 27 of 2008 |
| Decision Date |
Oct 21, 2009 |
| Hearing Date |
|
| Decision |
The appeal was dismissed as the appellants were not holding the requisite 10% shares in the company to apply for an investigation under section 263 of the Companies Ordinance, 1984. The appellants contended that their shares were fraudulently transferred to the respondent without proper notice and in violation of the Articles of Association. The court found that the authority letter provided by the appellants should have been considered, as it indicated their shareholding exceeded the 10% threshold required to initiate an investigation. However, since the matter primarily concerned shareholding disputes, the appropriate recourse for the appellants was under section 152 of the Companies Ordinance, which allows for rectification of the register of members. The court emphasized that the appellants may seek relief from a competent jurisdiction as the agreement for share transfer was deemed void due to procedural violations of the Articles of Association. |
| Summary |
This case revolves around an appeal made by Muhammad A. Jamal and others against Rizwan Ali Sherali concerning the fraudulent transfer of shares in Cott Knit (Pvt.) Ltd. The appellants alleged that their shares were transferred without due process, violating the Articles of Association of the company. The Securities and Exchange Commission of Pakistan heard the appeal and focused on the shareholding percentage required to initiate an investigation. The Commission ruled that the appellants did not meet the 10% threshold to apply under section 263 of the Companies Ordinance, 1984. The decision highlighted the importance of adhering to corporate governance and the procedures for share transfers. The appellants were advised to seek relief under section 152, which allows individuals to rectify the register of members if their names were improperly entered or omitted. This case underscores the complexities of corporate law, share ownership disputes, and the necessity for compliance with statutory requirements in share transactions, which are critical for maintaining transparency and accountability in corporate governance. |
| Court |
Securities and Exchange Commission of Pakistan
|
| Entities Involved |
Cott Knit (Pvt.) Ltd.
|
| Judges |
S. TARIQ ASAF HUSSAIN, COMMISSIONER (LD),
MUHAMMAD SOHAIL DAYALA, COMMISSIONER (SMD)
|
| Lawyers |
Syed Irshad-ur-Rehman
|
| Petitioners |
MUHAMMAD A. JAMAL,
YASIEN A JAMAL,
MUSTAFA PYARALI
|
| Respondents |
RIZWAN ALI SHERALI
|
| Citations |
2010 SLD 233 = 2010 CLD 232
|
| Other Citations |
Not available
|
| Laws Involved |
Companies Ordinance, 1984,
Securities and Exchange Commission of Pakistan Act, (XLII of 1997)
|
| Sections |
263,
152,
33
|