| Case ID |
2ea3ee40-cca3-4f66-b38d-c6560c8ed472 |
| Body |
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| Case Number |
Appeal No.34 of 2008 |
| Decision Date |
Dec 19, 2008 |
| Hearing Date |
|
| Decision |
The Securities and Exchange Commission of Pakistan upheld the appointment of Messrs A. F. Ferguson and Company, Chartered Accountants, to carry out a special audit of the affairs of Messrs United Industries Limited. This decision was based on the application filed by the respondents who jointly owned 49% of the company's shares, alleging misconduct by the appellants who owned 51%. The Commission found that the Executive Director acted within his jurisdiction to appoint the auditors under section 234-A of the Companies Ordinance, 1984. The appeal was dismissed as the appellants failed to demonstrate any prejudice caused by the proceedings, and the special audit was deemed necessary to investigate the serious allegations of mismanagement and financial misconduct raised by the respondents. |
| Summary |
This case revolves around the appeal No.34 of 2008 where the Securities and Exchange Commission of Pakistan was tasked with addressing allegations of financial misconduct and mismanagement at Messrs United Industries Limited. The respondents, owning 49% of the company's shares, filed an application for a special audit under section 234-A of the Companies Ordinance, 1984, citing serious allegations against the appellants, who controlled 51% of the shares. Key allegations included misappropriation of funds, running parallel businesses, and failing to provide dividends despite reported profits. The Commission upheld the Executive Director's decision to appoint auditors to scrutinize the company's affairs. This case highlights the importance of corporate governance and the regulatory powers of the Securities and Exchange Commission in ensuring accountability in companies. The decision reinforces the role of minority shareholders in seeking redress and the Commission's commitment to uphold transparency and fairness in corporate practices. Keywords: Securities and Exchange Commission, Companies Ordinance, corporate governance, financial misconduct, special audit, accountability. |
| Court |
Securities and Exchange Commission of Pakistan
|
| Entities Involved |
Messrs UNITED INDUSTRIES LTD.,
Mian WAQAR-UDDIN,
Kh. Saeed-uz-Zafar,
Asjad Saeed
|
| Judges |
RAZI-UR-REHMAN KHAN, CHAIRMAN,
S. TARIQ A. HUSSAIN, COMMISSIONER (L.D)
|
| Lawyers |
Kh. Saeed-uz-Zafar,
Asjad Saeed
|
| Petitioners |
another,
Messrs UNITED INDUSTRIES LTD.
|
| Respondents |
3 others,
Mian WAQAR-UDDIN
|
| Citations |
2009 SLD 162,
2009 CLD 525
|
| Other Citations |
PLD 1984 Lhr. 69,
PLD 1994 Kar. 358,
2000 CLC 364
|
| Laws Involved |
Companies Ordinance, 1984,
Securities and Exchange Commission of Pakistan Act, (XLII of 1997)
|
| Sections |
234,
234A,
33
|