| Case ID |
1f6979d1-5f98-4abd-8c9b-36e4e009451e |
| Body |
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| Case Number |
Appeal No. 1 of 2010 |
| Decision Date |
Jul 13, 2012 |
| Hearing Date |
Apr 20, 2012 |
| Decision |
The appeal was dismissed, and the penalty imposed by the Commission was upheld. The court found that the contravention of section 492 of the Companies Ordinance, 1984 was established as a knowingly made false statement, which does not require the ingredients of a criminal offence to be proven. The directors of the Company were found to have violated multiple sections of the Ordinance, and their actions were deemed to have been taken in disregard of legal provisions, particularly concerning the approval of transactions and disclosure of interests. The penalty of Rs. 35,80,000 was to be paid from the personal resources of the directors, and not from the Company's funds. |
| Summary |
In the case of Olympia Spinning and Weaving Mills Limited vs. Muhammad Anas Makhdoom, the Securities and Exchange Commission of Pakistan addressed significant violations of the Companies Ordinance, 1984. The case involved the provision of a Bank Guarantee by the Company to an associated entity without proper shareholder approval, as mandated by section 208 of the Ordinance. The Commission's decision emphasized the necessity of prior permissions for such arrangements, and the failure to disclose conflicts of interest among directors led to substantial penalties. This case serves as a critical reminder of corporate governance principles and the importance of compliance with statutory requirements, particularly in the textile industry where financial transactions are closely scrutinized. The ruling underlines the legal implications of false statements in corporate documentation and the responsibilities of directors in ensuring transparency and accountability within their companies. The decision reinforces the enforcement of corporate laws designed to protect shareholders and maintain market integrity. |
| Court |
Securities and Exchange Commission of Pakistan
|
| Entities Involved |
Bank Alfalah Limited,
Olympia Power Generation (Pvt.) Limited,
Olympia Spinning and Weaving Mills Limited
|
| Judges |
Imtiaz Haider,
Mohammed Asif Arif
|
| Lawyers |
Muhammad Anas Makhdoom,
Waqar Monnoo
|
| Petitioners |
Olympia Spinning and Weaving Mills Limited
|
| Respondents |
Muhammad Anas Makhdoom
|
| Citations |
2013 SLD 957,
2013 CLD 58
|
| Other Citations |
2003 CLD 131,
AIR (36) 1949 Madras 657,
AIR 1929 Bombay 443,
[1967] 37 Com Cas. 790
|
| Laws Involved |
Companies Ordinance, 1984
|
| Sections |
492,
193,
214,
216
|