Companies Act, 1994

 

Companies
Act, 1994

[XVIII of 1994]

 

Sections 2(d) & 3(1) –

The Company
Court has a special company jurisdiction and that jurisdiction has to be found
from specific provisions of the Act.

Abdul Muhit
and others vs Social Investment Bank Limited (SIBL) and others 54 DLR 306.

 

Section 38–

Discretion as
to registration of any transfer of shares implies just and proper consideration
of the proposal in the facts and circumstances of the case.

Giasuddin
Ahmed vs Green Delta Insurance Company Ltd and another 56 DLR (AD) 31.

 

Section 38–

Section 38
of the Companies Act gives the Court a wide discretion to scrutinize any fraud,
error or undue influence or misrepresentation in the matter of transfer of any
share and grant relief commensurating with the appropriate possible relief.

Ahmed lmpex
(Private) Ltd & others vs Moqbul Ahmed and others 56 DLR (AD) 92.

 

Section 38(3)–

In order to
be a valid and complete transfer of share for the company to register in its
register of members the instrument of transfer must be executed both by the
transferor and the transferee, the instrument of transfer must be duly stamped
and such instrument is delivered to the company along with the scripts.

Ahsan Karim
Jinnah vs Meghna Insurance Company Limited & others 52 DLR 160

 

Section 43–

The
jurisdiction of the Company Court is sufficiently wide to resolve the question
of rectification of the register of members.

Matiur Rahman
(Md) vs Dhaka Stock Exchange Ltd and another 51 DLR 530.

 

Section 43–

The
application under section 43 of the Companies Act for the rectification of the
Members Register is held to be not maintainable as the said matter has not been
earlier referred to the Arbitration Tribunal as provided in section 12 of the
Ordinance and/or as stipulated in Article 66 of the Articles of Association of
the Chamber of Commerce.

Ibrahim
Cotton Mills Ltd and others vs Chittagong Chamber of Commerce and Industry and
others 51 DLR 538.

 

Section 59(1) –

A mistake,
whether clerical or others in the Memorandum of Articles can be amended by
altering the Memorandum and Articles. Court’s approval has to be obtained if
particular amendment requires such approval.

Tropical
Homes Limited vs Registrar of Joint Stock Companies 48 DLR 576.

 

Sections 81(2) & 85(3)–

Delay in
holding the adjourned annual general meeting of the petitioner company is
condoned as it appears that the same could not be held as the balance sheet
profit and loss account were not ready to be laid in the meeting.

Bengal Steel
Works Limied vs Registrar of Joint Stock Companies and Firms 48 DLR 101.

 

Sections 81(2) & 85(3)–

If it is
made to appear to the Court that the annual general meeting or meetings were
not held in accordance with the directions made by its earlier order the Court
shall have competence to order for holding such meeting or meetings afresh.

Tahmid Ahmed
vs Jalaluddin Jaffar Ali Hussain.YZ DLR 141

 

Sections 81(2) & 85(3)–

The omission of notifying a director about the
holding of a board meeting invalidates the proceedings and such meeting of
directors cannot be said to have been duly convened in the absence of service
of notice.

Tahmid Ahmed
vs Jalaluddin Jaffar Ali Hussain 52 DLR 141

 

Section 85(2)(3)–

If for any reason it is impracticable to call,
hold and conduct a meeting on the happening of any circumstance the Court being
satisfied to that effect to call a meeting in the manner such a meeting is to
be called, could pass an order for holding the meetings to be conducted by a
neutral Chairman even in the absence of an application.

United
Commercial Bank Ltd vs Jahangir Alam Khan and others 56 DLR (AD) 76.

 

Section 85(2)(3)–

If for any
reason it is impracticable to call, hold and conduct a meeting on the happening
of any. circumstance the Court being satisfied to that effect to call a meeting
in the manner such a meeting is to be called, could pass an order for holding
the meetings to be conducted by .a neutral Chairman even in the absence of an
application.

United Commercial Bank Ltd vs Jahangir Alam Khan and others 56 DLR
(AD) 76.



 

Sections 85(3)–

There is no
fetter on the powers of the Court in invoking sub–section 3 of section 85 to
call, hold and conduct a meeting and not restricted only to the articles or the
Act. However, the Court shall not invoke its power on a mere trifling domestic
squabble between the directors but only when it is necessary in the paramount
interest of the company, looking at the facts from a reasonable commonsense
point of view and acts as a prudent person of business to decide whether it has
become impracticable to call a general meeting.

Jahangir Alam Khan vs Registrar, Joint Stock Companies and ors 55
DLR 495.

 

Sections 85(3)–

The Court,
in considering a prayer for holding a meeting, should be cautious and in normal
circumstances should not supersede the rights and wishes of the share–holders
and their representatives, the directors to manage and run the company
including holding of their meetings.

Jahangir
Alam Khan vs Registrar, Joint Stock Companies and ors 55 DLR 495.

 

Section 89(3)–

The
provision of law that until the contrary is proved a meeting of the Directors
of a company shall be deemed to have been duly called will be of no avail
without the foundation of minutes of the meeting which is yet to be produced.

Mohibul Ahsan (Md) (Shawan), Director, Ittefaq Group of
Publications Ltd and others vs Ittefaq Group of Publications Ltd represented by
Mainul Hosein Executive Director 1 and others 50 DLR (AD) 138.

 

Section 91–

Appellants
representing majority shares having contested the written objection filed by
the respondent No.1 challenging election of Mr A Matin Khan before the Company
Judge have locus standi to file the appeal.

ASF Rahman and another vs AM Agha Yousuf and others 52 DLR (AD)
127.

 

Section 91(1)(b)–

Under the
garb of recommendation Board of Directors cannot reject the candidature of any
person for the election to the office of the director of the Bank.

ASF Rahman and another vs AM Agha Yousuf and others 52 DLR (AD)
127.

 

Section 95–

For holding
a valid meeting of the Board of Directors written notice must be given to all
the members of the board of directors. If anyone is left out the resolution
taken in that meeting becomes invalid.

Ittefaq Group of Publications Limited & others vs Arab
Bangladesh Bank Limited & others 50 DLR 597.

 

Section 95–

In all
companies either private or public for holding a board meeting a written notice
shall be given to every director and civil Court may not interfere when there
is a valid meeting. When there is prima facie and invalid resolution the civil
Court can interfere. The respondents are restrained by an order of temporary
injunction from acting on the alleged resolution of the Board of Directors.

Ittefaq Group of Publications Limited & others vs Arab
Bangladesh Bank Limited & others 50 DLR 597.

 

Section 95–

The Courts
are generally reluctant to interfere with the decisions taken at company
meetings unless there is almost a manifest breach of the Articles or the
Statute, because it is the company and not the Court which is responsible for
its management.

Mohibul Ahsan (Md) (Shawan), Director, Ittefaq Group of
Publications Ltd and others vs Ittefaq Group of Publications Ltd represented by
Mainul Hosein Executive Director 1 and others 50 DLR (AD) 138.

 

Section 95–

Unless
jurisdiction is provided in the Companies Act the petitioners cannot come to
this Court for violation of any provision of the Act. This court does not have
any general, plenary or residuary jurisdiction to deal with other matters and
questions arising under the Companies Act.

Abdul Muhit
and others vs Social Investment Bank Limited (SIBL) and others 54 DLR 306

 

Section 108–

There was no
obligation on the part of the petitioner to tender resignation in terms of
Articles 49 ( c) as stated in the plaint specially when by operation of law, he
automatically ceased to be a director.

Tanveerul
Haque vs Unistar Shipping Limited and ors 52 DLR 215

 

Sections 210(7) & 233–

The
provisions of appointing auditors in the Annual General Meeting is for
prospective auditing of a Company when the minority share–holders apply under
section 233 of the Companies Act, the Court has inherent power to make
alternative arrangements for appointment of Auditors for past years, if no
auditing has taken place.

Faruk (Md) vs Abdul Hamid and others 51 DLR (AD) 48

 

Section 233–

Half of the
board comprises the petitioners. In other words, out of 4 directors, two are
the petitioners and the petitioners hold 50% of the shares. Thus the
petitioners, having holding 50% of the shares cannot be said to be minority
share–holders. Accordingly, the petitioners are not entitled to invoke the
jurisdiction of the court under section 233 of the Companies Act, 1994.

Moksudur Rahman, son of late Al–haj Syedur Rahman and another vs
Bashati Property Development Limited, and others 49 DLR 539.

 

Section 233–

There cannot
be any profit out of revaluation of any fixed assets of the company without
disposal of the same by sale or otherwise and that too without writing off the
trading losses in earlier financial periods.

ABS Safdar
and ors vs People’s Republic of Bangladesh and others 52 DLR 249.

 

Section 233–

A
shareholder does not become automatically entitled to any part of the profit
until a resolution is taken and a dividend is declared by the company out of
such profit.

ABS Safdar
and ors vs People’s Republic of Bangladesh and others 52 DLR 249.

 

Section 233–

Balance–sheet,
no doubt, is a good evidence of acknowledgment of any liability of the company.
But the balance–sheet should not be accepted as an acknowledgment if it is
found that the directors or those who are in control of the company took
decision favouring or in furtherance of their interest although that was to the
detriment of the company and the minority shareholders.

ABS Safdar
and ors vs People’s Republic of Bangladesh and others 52 DLR 249

 

Section 233–

Since the
points raised by the applications under consideration do not require detailed
investigation and can be entertained and adjudicated upon by the Company Court,
pendency of the civil suit will not operate as a bar.

ABS Safdar
and ors vs People’s Republic of Bangladesh and others 52 DLR 249

 

Section 233–

When an
application is admitted the same is not liable to be dismissed/ rejected
summarily without hearing on merit, unless such application is absolutely
incompetent being without jurisdiction.

Nahar
Shipping Lines Limited and another vs Homera Ahmed and others 52 DLR 585.

 

Section 233–

A minority
share holder can petition the Court for relief if there has been fundamental
breach of the rules and where the majority endeavoring directly or indirectly
to appropriate to themselves money, property or advantages which belonged to
the company.

Syed Al
Nesar Ahmed, MD, United Food Complex Ltd vs Nafisa Choudhury and others 5 DLR
(AD) 83.

 

Section 233–

This Court
has the power to give direction for protection of interest of the minority. The
word interest has been used in various legislations in various senses. In the
present context, it need not, however be only the possibility of a pecuniary
advantage, it may equally be the likelihood of a pecuniary loss.

Nafisa
Choudhury vs United Food Complex Ltd. and another 53 DLR 81.

 

Section 233–

The Court
can make any just order beyond the relief sought for, to bring the affairs of
the company to its right track to safeguard the interest of the minority share
holders.

Nafisa
Choudhury vs United Food Complex Ltd. and another 53 DLR 81.

 

Section 233–

The Managing
Director appointed for a particular period under the articles should be allowed
to function as Managing Director with all such powers as given in the Articles
of Association and in accordance with the provision of law.

Nafisa Choudhury
vs United Food Complex Ltd. and another 53 DLR 81.

 

Section 233–

The section
specifically protects the interests of the minority shareholder/ shareholders
when prejudiced and discriminated against, it does not protect the interest of
a director, however prejudiced or discriminated by the way the company is
conducted.

ASM Shamsul
Islam Rashedi vs Satellite Fishing Ltd and others 54 DLR 28.

 

Section 233–

In an
application under section 233 the main function of the Court is not to see
whether fraud is committed but whether the resolutions adopted are unfair to
the company and the minority shareholders.

Shahadat
Hossain (Md) vs Base Textile Ltd 54 DLR 583

 

Section 233–

For adoption
of a special resolution in any Extraordinary General Meeting amending an
article or articles, there should be a decision of the Board expressing the
need for such amendment of the article.

Shahadat
Hossain (Md) vs Base Textile Ltd 54 DLR 583.

 

Section 233–

Nothing is
produced as evidence to show that the secretary was empowered by the concerned
authorities to call the Extraordinary General Meeting. The Extraordinary
General Meetings are not properly called meetings and no meetings in the eye of
law. Any decision taken in those meetings suffers from illegality.

Shahadat
Hossain (Md) vs Base Textile Ltd 54 DLR 583

 

Section 233–

Absolute
authorisation to give loan by the Managing Director from the Company’s fund is
contrary to the provisions of the company law and prejudicial to the interest
of the company and its members.

Shahadat
Hossain (Md) vs Base Textile Ltd 54 DLR 583

 

Section 233–

A remedy
under section 233 can be given only if the directors have acted in breach of
duty or if the company has breached any of its articles or any relevant
agreement.

Nahar
Shipping Lines Ltd and anr vs Homera Ahmed and others 56 DLR (AD) 36.

 

Section 241–

The
petitioner having not shown how he would derive any advantage or minimise some
disadavantage from winding up of the respondent company he has no locus standi to
petition for its winding up.

Mazharul
Haque vs Bulk Management (Bangladesh) Ltd, and others 48 DLR 453.

 

Sections 241 & 242–

The claim is
not undisputedly ascertained, and unless it is admitted it cannot be said it is
a debt and the respondent company is liable to pay the debt. Winding up of a
company by Court for debt is not called for where there is a bonafide dispute
relating to the existence of the debt.

Ambala Cold
Storage (Pvt) Ltd vs Prime Insurance Co. Ltd 56 DLR 422.

 

Section 241(III)–

The company
has been stopped for more than one year which itself is a ground for winding up
of the company.

Vega
Sweaters (Pvt) Ltd 52 DLR 372.

 

Section 241(IV)–

The number
of members having been reduced to less than two the company is liable to be
wound up as per section 241(1V) of the Companies Act.

Vega
Sweaters (Pvt) Limited 52 DLR 372.

 

Section 241 (V) & (VI)–

Company’s
inability to pay debts, and when it is just and equitable that it should be
wound up, are also legal grounds for winding up under section 241 (V) and 241
(VI) respectively of the companies Act.

Vega
Sweaters (Pvt) Ltd 52 DLR 372.

 

Sections 241(V) and 250–

Winding
up–An order of winding up of a company can be made in the discretion of the
Court but under section 250 of the Act; when a winding up order has been made,
no suit or other legal proceedings shall be proceeded with or commenced against
the company except by leave of the Court. If the proceeding under section 24 l
of the Companies Act satisfies the requirements of law, it shall certainly find
its mark in accordance with law and shall not be disallowed or deviated because
of other equally efficacious remedies available to the petitioner in another
forum.

Amir Hossain
vs Homeland Footwear Ltd and others 55 DLR 478

 

Sections 242 & 248–

From the
conduct of the respondent company and in the manner promises were made,
assurances given, new repayment schedules chalked out again and again only to
be broken giving the impression that the affairs of the company are not clean
and above board, the opinion is that the respondent company is unable to pay
its debt and it will be just and equitable if the company is wound up. Hence,
it is ordered that the respondent–company is wound up with immediate effect.

Eastern Bank
Limited vs Bengal Carpets Ltd 48 DLR 392.

Companies Act, 1994

Companies Act, 1994

 

Principle —to Pay
Loan

The
Petitioners not being a money lender or a financial institution is not legally
permitted to pay loan to any one for deriving interest. On the other hand, the
respondent being a company and not a financial institution is also not legally
permitted to take any loan and pay interest to any private individual.

Mrs. Tamanna-e-Jahan
Vs. Paper Converting and Packaging Ltd. & Ors. 10 BLT (HCD) 450

Section-43 Read with, Companies Act, 1913 Section-38

Rectification of
Share register of the Company

Since
the identity of the actual petitioner is in serious doubt and since the
allegations of fraud forgery and fabrication in respect of the different
resolutions and decisions of the Board of Directors of the respondent- company
have been raised, involving complicated questions of disputed facts of serious
nature, requiring further examinations of evidence in details which is not
possible in this forum, the instant petition is liable to be dismissed.

M. Islam Vs.
Al-Rajhi Hospital (Pvt.) Limited & Ors. 11BLT (HCD)-474

Section-59

The
instant company is a public limited company and is authorized by Articles-37 of
the Articles of Association of the said company to make reduction of its share
capital. The proposed resolution reducing the paid-up share capital is not
likely to prejudice the interest of the share holder or its creditors. On the
contrary if the reduction of the said paid-up share capital is not confirmed by
the court it is likely to Misrepresent the actual position of the paid-up share
capital of the company— the reduction of the paid up share capital of the
company by way of special resolution of the company, confirmed.

Uttara Himghar Ltd. 8BLT(HCD)-331

Section-81(2) and 85(3)

In terms
of section 81(2) of the Companies Act the High Court Division while directing
the calling of a general meeting of the company may give such ancillary or
consequential direction as the Court thinks expedient in relation to the
calling, holding and conducting of the meeting and in terms of Section 85(3)
the High Court Division while giving an order of calling the meeting may also
give such ancillary or consequential direction as it thinks expedient.

Bangladesh Bank Vs.
Sk. Abul Hossain & Ors 16 BLT (AD)110

Section 81(2) and 85(3)

Whether Annual
General meeting to be held without the agenda of election of directors

Petitioner
is a Shareholder —Held: I am of the view that the 20th Annual General Meeting
can be ordered to be held without the agenda of election of the Directors which
is Agenda No. 4 of the notice of the 20th Annual General  Meeting in the overall interest of the share
holders of the respondent Bank.

Sk. Abul Hassan Vs.
The City Bank Limited & Ors 13 BLT (HCD)480

Section-85(2) read with Section 85(3)

Meetings to be
conducted by a neutral Chairman.

We are
of the view that under the circumstances, if for any reason it is impracticable
to call, hold and conduct a meeting on the happing of any circumstances the
Court being satisfied to that effect to call a meeting in the manner such a
meeting is to be called, could pass an order for holding the meetings to be
conducted by a neutral Chairman even in the absence of an application under
section 85(3) of the Companies Act invoking the provision of section 85(2) of the
Companies Act in the facts and circumstances of the case.

United Commercial
Bank Ltd Vs. Jahangir Alam Khan & Ors 12BLT(AD)213

Section-91(1)(b) read with International
Finance Investment and Commerce Bank Ltd. (IFIC Bank)

Article-114

Recommendation
—Held: The power of the Board of Directors in the said Article 114 to recommend
does not mean power to reject any such candidature. No such power to reject
such candidature has been specifically given to the Board of Directors in the
said Article or any other Article. So under the garb of recommendation Board of
Directors cannot reject the candidature of any person for these election to the
office of the director of the Bank. In our considered view the word
“recommended” means power of the Board to point out defects, if any in the
candidature of a person for the office of director for consideration in the
Annual General Meeting to avoid complications in such meeting and not the power
to reject any candidature on the ground of defect real or fanciful, It is for the
Annual General Meeting to consider defect, if any, in the candidature of a
person and to take a decision over the same and not for Board of Directors to
do so.

ASF  Rahman and Anr. Vs. A.M. Agha Yousuf &
Ors. 10 BLT (AD)-86

Per Bimalendu Bikash Roy Choudhury, j:

I am
unable to agree that the word ‘recommendation occurring in the Article connotes
mere scrutiny without any authority to choose. I take the simple dictionary
meaning of the word recommendation’. I mean speaking favourably of a person for
the purpose of election.

ASF 
Rahman and Anr. Vs. A.M. Agha Yousuf & Ors. 10 BLT (AD)-86

Locus Standi

Aggrieved
person — A voter cannot prefer an appeal against setting aside of the election
of a successful candidate in an election. But that analogy will not hold good
in respect of the election of directors of a company including a Bank Company.

Per Bimalendu Bikash Roy Choudhury, J:

Held:
The appellants have no locus standi to maintain the appeal not being themselves
aggrieved by the election.

ASF Rahrnan and Anr.
Vs. A.M. Agha Yousuf & Ors. 10 BLT (AD)-86

Section-95

Temporary Injunction

The
courts are generally reluctant to interfere with the decisions taken at company
meetings unless there is almost a manifest breach of the Articles or the
statute, because it is the company and not the Court which is responsible for
its management.

Mohammad Mohibul
Ahsan (Shawan) & Ors. Vs. Ittefaq Group of Publications ltd. 7BLT
(AD)-14

Sections-228 & 229

The
following principles governing the amalgamation of and merger of the companies
emerge:

(i) The
scheme satisfies the requirements of law.

(ii) The
Court should see that the shareholders, who may be effected by the scheme have
been fairly represented.

(iii) The scheme is passed by the majority of the share-holders in value.

(iv) Scheme should be in the interest of the share-holders of the
transferor and the transferee company.

(v) Sanction should be given to such a workable scheme which a man of
business would reasonably approve.

(vi) The
Court may impose conditions and modify the scheme, if so required.

(vii)
Sanction should be given to a bonafide scheme which is fair as a whole, to all
concerned.

(viii)
The scheme should not only be in the interest of the share-holders of the
companies hut also in public interest.

Chittagong Cement
Clinker Grinding Co. Ltd. Vs. Joint Stock companies and Firms. 11BLT (HCD)-81

Section-233

Petitioner
as director and shareholder of Respondent No.1 Company seeking a declaration
that the Board Resolution dated 10.5.2006 is discriminatory and prejudicial and
in disregard to the interest of the Petitioner as a minority shareholder in the
Company —Held; the ratio in The Rashedi Case, therefore. remains fully
applicable to the fact. and circumstances of the case and this case is nothing
but one of the Petitioner as Chairman and Director of the Company being faced
with an allegation of secret profit in breach of his fiduciary duty as a
director vis-a-vis the Company as has been dealt with by the Company adequately
in bringing the process of enquiry and accountability to fully bear upon the
Petitioner in the perceived best interests of the Company. The actions of the
BOD vide the resolution dated 10.5.2006 merely reflects a part of that overall
exercise aptly undertaken.

Md. Shahjahan Miah
Vs. car Diagnostic Centre Pvt. Ltd & Anr 16 BLT (HCD) 203

Section-233

Company
was incorporated under the provisions of section 26 of the Companies Act, 1913,
as an association, without any share capital, not for profit, as such, in view
of section 195 (b), as required under sub-section 1 of section 233, an
application is not maintainable unless filed by at least one-fifth members of
the company. Since in the instant case, there is only one applicant, which
number fails to fulfill the condition of the required minimum as specified
under section 195(b), the instant application is not maintainable.

Nurul Hoque
Chowdhury Vs. Mrs. Mahzabin Chowdhury 12BLT (HCD)261

Section-233

Private Limited
company

In
considering the affairs of the company, one must not lose sight of the concept
of a body corporate. It has a memorandum and articles of association and it is
expected that the will of the majority members of a company expressed in a
general meeting, binds all the members including the members who voted against
it. Even the articles of association of the company, which is a contract
between the company and its members, with certain restrictions, can be altered
by a special resolution. Besides, even in case of allegations of irregularities
in the internal management of a company, the Court will not interfere at the
instance of minority members of the company if it is confirmed or ratified in a
general meeting, especially in case of a private limited company.

Nurul Hoque
Chowdhury Vs. Mrs. Mahzabin Chowdhury 12 BLT (HCD)261

Section-241 and 242

For winding up of
company

The
respondent admitted that a sum of Tk.9,55,941 .00 was due to the petitioner up
to November, 1997 out of which the respondent paid a total sum of Tk.
1,00,000.00 thereby the admitted liability of the respondent No. 1 to the
petitioner is Tk. 8,55,94,100

Held:
The respondent company is unable to pay its admitted debt of Tk. 8,55,941.00
and as such it is liable to be wound up.7)

M. A. Gaffer Ltd. Vs
Enjari Garments (Pvt.) Lid, 8 BLT(HCD)-295

Section-241

The company
is a private Limited Company— the quorum necessary for transaction of the
business of the Directors shall be two —since Articles of Association of the
company provides that the business of the Board of Directors, is two, the
company has been unable to do any business And the business of the company has
been stopped for more than one year. The company in its present state of
affairs is unable to pay its debts and it is just and equitable that the
company should be wound up.

Vega Sweater (Pvt)
Limited & Anr. Vs. Agrani Bank 8BLT(HCD)-226

Section-241

Since
the petitioner had earlier filed a case under Section 138 of the Negotiable
Instrument Act, he is debarred from proceeding with the winding up petition as
contended by the respondents learned Counsel.

Held :
The submissions made on behalf of the respondents, has got no substance, If the
proceeding under Section 241 of the Companies Act satisfies the requirements of
law, it shall certainly finds its mark in accordance with law and shall not be
disallowed or deviated because of other equally efficacious remedies available,
to the; petitioner in another forum.

Amir Hossain Vs.
Home Land Footwear Ltd. & Ors. 11BLT(HCD)-20

Section-241

The
respondent company owes to the petitioner but failed to repay the debt —it is
apparent that the company not only neglected to pay its debt but at the moment
it is unable to pay its admitted debt of Tk. 60.00 Lac to the petitioner. Since
the papers on record do not show any effort on behalf of the respondent-company
to pay off its debt to the petitioner, it should be wound up so that interest
of the other creditors may not be prejudiced any further.

Amir Hossain Vs.
Home Land Footwear Ltd. & Ors 11BLT (HCD)-20

Section-241

Petitioner
is the publisher of a Magazine and the respondent No.1 is a limited liability Company
and involved in the business of publishing, printing, and packaging —Held:
Their exist a bonafide dispute relating to the existence of the debt and the
amount of debt and to determine, the, same winding up  proceeding is not available to the
petitioner.

Mrs. Tamanna-e-Jahan
Vs. Paper Converting and Packaging lid, & Ors 10 BLT (HCD) 450.

Companies Act, 1994

 

Companies Act, 1994

 

Principle —to Pay Loan

The Petitioners not
being a money lender or a financial institution is not legally permitted to pay
loan to any one for deriving interest. On the other hand, the respondent being
a company and not a financial institution is also not legally permitted to take
any loan and pay interest to any private individual.

Mrs. Tamanna-e-Jahan Vs.
Paper Converting and Packaging Ltd. & Ors. 10 BLT (HCD)-450

 

Seetion-43 Read with,

Companies Act, 1913 Section-38

Rectification of Share
register of the Company

Since the identity of
the actual petitioner is in serious doubt and since the allegations of fraud
forgery and fabrication in respect of the different resolutions and decisions
of the Board of Directors of the respondent-company have been raised, involving
complicated questions of disputed facts of serious nature, requiring further
examination of evidence in details which is not possible in this forum, the
instant petition is liable to be dismissed.

M. Islam Vs. Al-Rajhi
Hospital (Pvt.) Limited & Ors. 11 BLT (HCD)-474.

 

Section-59

The instant company is a
public limited company and is authorized by Articles-.17 of the Articles of
Association of the said company to make reduction of its share capital. The
proposed resolution reducing the paid-up share capital is not likely to
prejudice the interest of the share holder or its creditors. On the contrary if
the reduction of the said paid-up share capital is not confirmed by the court
it is likely to mis-represent the actual position of the paid-up share capital
of the company—the reduction of the paid up share capital of the company by way
of special resolution of the company, confirmed.

Uttara Himghar Ltd.
8BLT(HCD)-331

 

Seffion-91(l)(b) read with

International Finance Investment and Commerce Bank Ltd.
(IFIC Bank)

Article-114

Recommendation — Held:
The power of the Board of Directors in the said Article I 14 to recommend does
not mean power to reject any such candidature. No such power to reject such
candidature has been specifically given to the Board of Directors in the said
Article or any other Article. So under the garb of recommendation Board of
Directors cannot reject the candidature of any person for these election to the
office of the director of the Bank. In our considered view the word “recommended”
means power of the Board to point out defects, if any in the candidature of a
person for the office of director for consideration in the Annual General
Meeting to avoid complications in such meeting and not the power to reject any
candidature on the ground of defect real or fanciful. It is for the Annual
General Meeting to consider defect, if any. in the candidature of a person and
to take a decision over the same and not for Board of Directors to do so.

ASF Rahman and Anr. Vs.
A.M. Agha Yousuf & Ors.10BLT (AD)-86

 

Per Bimalendu Bikash Roy Choudhury, J: I am unable to agree
that the word ‘recommendation occurring in the Article connotes mere scrutiny
without any authority to choose. I take the simple dictionary meaning of the
word ‘recommendation’. I mean speaking favourably of a person for the purpose
of election.

ASF Rahman and Anr. Vs.
A.M. Agha Yousuf & Ors. 10 BLT (AD)-86.

 

Locus Standi

Aggrieved person — A
voter cannot prefer an appeal against setting aside of the election of a
successful candidate in an election. But that analogy will not hold good in
respect of the election of directors of a company including a Bank Company.

Per Bimalendu Bikash Roy
Choudhury, J : Held : The appellants have no locus standi to maintain the
appeal not being themselves aggrieved by the election.

ASF Rahman and Anr. Vs.
A.M. Agha Yousuf & Ors. 10 BLT(AD)-86.

 

Sections-228 & 229

The following principles
governing the amalgamation of and merger of the companies emerge:

·
The
scheme satisfies the requirements of law.

·
The
Court should see that the share­holders, who may be effected by the scheme,
have been fairly represented.

·
The
scheme is passed by the majority of the share-holders in value.

·
Scheme
should be in the interest of the share-holders of the transferor and the
transferee company.

·
Sanction
should be given to such a workable scheme which a man of business would
reasonably approve.

·
The
Court may impose conditions and modify the scheme, if so required.

·
Sanction
should be given to a bona fide scheme which is fair as a whole, to all
concerned.

·
The
scheme should not only be in the interest of the share-holders of the companies
but also in public interest.

Chittagong Cement
Clinker Grinding Co. Lid. Vs. Joint Stock Companies and Firms. 11 BLT (HCD)-81.

 

Section-241 and 242

For winding up of
company

The respondent admitted
that a sum of Tk. 9,55,941.00 was due to the petitioner up to November. 1997
out of which the respondent paid a total sum of Tk. 1.00.000.00 thereby the
admitted liability of the respondent No. 1 to the petitioner is Tk. 8,55,941.00
—Held : The respondent company is unable to pay its admitted debt of Tk.
8.55,941.00 and as such it is liable to be wound up.

M. A. Gaffer Ltd. Vs
Enjari Garments (Pvt.) Ltd. 8 BLT (HCD)-295.

 

Section-241

The company is a private
Limited Company— the quorum necessary for transaction of the business of the
Directors shall be two—since Articles of Association of the company provides
that the business of the Board of Directors is two, the company has been unable
to do any business. And the business of the company has been stopped for more
than one year. The company in its present state of affairs is unable to pay its
debts and it is just and equitable that the company should be wound up.

Vega Sweater (Pvt.)
Limited & Anr. Vs. Agrani Bank 8BLT(HCD)-226.

 

Section-241

Since the petitioner had
earlier tiled a case under Section 138 of the Negotiable Instrument Act. he is
debarred from proceeding with the winding up petition as contended by the
respondent’s learned Counsel.

Held: The submissions
made on behalf of the respondents, has got no substance. If the proceeding
under Section 241 of the Companies Act satisfies the requirements of law. it
shall certainly finds its mark in accordance with law and shall not be
disallowed or deviated because of other equally efficacious remedies available
to the petitioner in another forum.

Amir Hossain Vs. Home
Land Footwear Ltd. & Ors. 11 BLT (HCD)-20.

 

Section-241

The respondent company
owes to the petitioner but failed to repay the debt — it is apparent that the
company not only neglected to pay its debt but at the moment it is unable to
pay its admitted debt of IT. 60.00 Lac to the petitioner. Since the papers on
record do not show any effort on behalf of the respondent-company to pay off
its debt to the petitioner, it should be wound up so that interest of the other
creditors may not be prejudiced any further.

Amir Hossain Vs. Home
Land Footwear Ltd. & Ors. 11 BLT (HCD)-20.

 

Section-241

Petitioner is the
publisher of a Magazine and the respondent No. I is a limited liability Company
and involved in the business of publishing, printing and packaging —Held: Their
exist a bonafide dispute relating to the existence of the debt and the amount
of debt and to determine the same winding up proceeding is not available to the
petitioner.

Mrs. Tamanna-e-Jahan Vs.
Paper Converting and Packaging Ltd. & Ors. 10 BLT (HCD)-450.