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(a) Companies Ordinance (XLVII of 1984)‑‑

‑‑‑Ss. 152 & 9‑‑Proceedings under 5.152 are restricted to correction of error or removal of defects of imperfections of the kind mentioned therein‑‑Power vesting under S.152 is not to be invoked where resolution of questions raised require holding of detailed inquiry and going into complex questions of law and fact‑‑Petition under S.152 stated that the removal of petitioner's name from register of directors was on basis of fake and forged documents of transfer deed and letter of registration, although it was admitted that the signatures appearing on the documents were his but he had in fact signed on blank paper including blank transfer deed as he had implicit faith in the respondent; it was further alleged that the respondent had later on written him a letter assuring petitioner that his name would be shown in the Company's paper and he would be relegated to his original position both the respect of his share and office of Director of Company‑‑Respondent denied having signed or issued any such letter‑‑Held, questions raised required holding of detailed inquiry into complex questions of law and fact more appropriately to be left to be decided at a regular trial‑‑Petition under 5.152 in circumstance dismissed.

Jagan Nath v. Gopi Chand A I R 1915 Lah. 100; Peoples Insurance Company Ltd. v. M/s. C.R.E. Wood and Company Ltd. AIR 1960 Pb. 388; Smt. Soma Vati Devi Chand v. Krishna Sugar Mills Ltd., Delhi and others A l R 1966 Pb. 44; Delakhat Tea Company Ltd. A I R 1957 Cal. 476; Public Passenger Service Ltd. v. M.A. Khader A I R 1962 Mad. 276 and Shah Muhammad and 6 others v. Mat. Resham Bibi and 8 others 1986 C L C 2561 ref.

(b) Companies Ordinance (XLVII of 1984)‑‑

‑‑‑Ss. 186, 189, 205 & 7‑‑Imposition of penalties under Ss.186 a 189 and for relief required "Authority" is to be approached and not the High Court.

Dr. Khalid Ranjha and Shabbir Raza Rizvi for Petitioner. Syed Jamshed Ali for Respondent.

Dates of hearing: 21st and 24th June, 1987.

This judgment will dispose of two petitions (C.O. No. 9 of 1986 and C.O. No. 10 of 1986) as one and the same questions of fact and law are involved in both these petitions.

2. The facts necessary for disposal of these petitions are that Salahuddin Khan petitioner was the promotor director of Almansoor Limited (a private limited company). He subscribed for 100 shares of the value of Rs.100 each soon after the incorporation of the company. In February, 1966, June, 1967 and 1970 further shares were issued with the result that the petitioner became the share‑holder to the extent of 2000 shares of the respondent company. It is also asserted in these petitions that the petitioner was the managing director of the company while his two brothers, namely, Javaid Masud and Abdur kauf, were co‑opted as directors in 1971. This position, according to the petitioner, prevailed upto the month of December, 1977, but in 1978 on the basis of an authority letter the petitioner, it was asserted, was shown to have surrendered his shares and resigned from the office of director of the company. It is also asserted in the petition that there existed a relationship of complete confidence between the petitioner and the family of his sister as Syed Jamat Ali Shah respondent is husband of the sister of the petitioner whereas Mansoor Ali is the son of the said sister and Syed Shahzad Ali the other share‑holder is the younger brother of Syed Jamat Ali Shah respondent. The case of the petitioner is that as he was involved in another venture he did not keep track of the intrigue cooked against him but however on coming to know of the same he checked up with the Registrar's office and found that the Registrar had been sent a photo copy of the alleged letter of resignation from directorship of Almansour Limited and that on query made from the National Bank of Pakistan, he was informed vide letter dated 11‑1‑1979 that his shares which stood pledged with the bank had also been transferred. The petitioner admits that from the Registrar's office he received an official intimation dated 30‑11‑1978 that his name was being removed from the register of directors/ share-holders and that in reply to the said notice he wrote to the Registrar that the alleged registration was forged and fake and that he was not bound by the same.

3. The petitioner as per assertions contained in the petition challenged the omission of his name from the register of members and transfer of his shares, in the Civil Court Peshawar and ultimately the Peshawar High Court vide order dated 26‑3‑1983 directed the petitioner to pursue his remedy in the proper Court observing that the Civil Court lacked jurisdiction. The petitioner alleges that thereafter, the petitioner approached members of the family, relatives and common friends and on account of their persuasions, respondent No.2 conveyed in writing to the petitioner that the petitioner would be shown in the company papers to have been relegated to the original position both in respect of his shares and the office of director of the company and that Form 'E' and Form XII to be submitted towards the end of 1985 will reflect the aforesaid position. The petitioner complains that now when he checked the record of the company from the office of the Registrar, he found that neither Form 'E' nor Form XII filed for the year 1985 reflected the promise made in the letter dated 1‑4‑1985 nor any rectification was effected in the register of members or other documents of the company. On the basis of the aforenoted assertions the reliefs claimed in the petition (C.U.9‑86) are that the respondents be ordered to perform their statutory duty under section 205 of the Ordinance by maintaining the register of directors in accordance with law and that the removal of the petitioner's name from the register of directors on the basis of fake and forged resignation be declared as illegal and unlawful and his name be restored in the register of directors and the same be deemed to have never been removed therefrom. It is also prayed therein that the filling in of the vacancy by respondent No.3 be declared as illegal and iraudulent, and respondent No.3 be punished for styling himself as director of the company.

4. In the other petition (C .0.10‑86) the reliefs prayed for under sections 152 and 153 of the Companies Ordinance are that the register of members of the respondent company be rectified by restoring the name of the petitioner as share‑holder in the said register and the share‑certificates be ordered to be restored to the petitioner and all transactions made taking advantage of the endorsements in blank in the petitioner's share certificates be declared as illegal, unlawful and of no consequence. It is further prayed that the respondents be ordered to give the petitioner his share of dividends available to him since 1978.

5. Notice of appearance at admission stage was ordered to be issued to the respondents in C.O.No.10 of 1986 for knowing whether the letter dated 1‑4‑1985 was issued by respondent No.2 or not. Thereafter, the respondents were also directed to be served by publication of notice in Daily Dawn, Karachi and Daily Nawa‑e‑Waqat, Lahore. Syed Jamat Ali Shah respondent entered appearance on behalf of the respondents. Statements of Salahuddin Khan petitioner and Syed Jamat Ali Shah respondent were also recorded and they were allowed to bring on record relevant documents.

6. The final position which emerges from the record is that by executing the transfer deed dated 6‑8‑1978 (Mark 'C') and letter of resignation dated 5‑8‑1978 (Mark 'B'), Salahudin Khan petitioner transferred his shares and resigned from the directorship of Almansoor Limited. The petitioner admitted that the signatures appearing on these documents were his but added that Syed Jamat Ali Shah in whom he had implicit faith had obtained his signatures on various blank papers including blank transfer deed. He produced in support of this ‑version an affidavit of Brig. Iftikhar to the effect that Syed Jamat All Shah showed to the deponent a blank transfer deed allegedly signed by the transferor Salahuddin Khan and that in his presence Syed Jamat Ali Shah filled up the blank transfer deed and then asked him to affix his thumb‑impression thereon.

7. The legal proceedings instituted by the petitioner may now be taken note of. The petitioner filed a suit on 25‑3‑1979 challenging removal of his name from the register of members and from the register of directors on the basis of the alleged transfer deed and letter of resignation. This suit was dismissed in default on 22‑5‑1979. He then filed writ petition No.754 of 1979 (Mark 'E') but the same was dismissed as withdrawn on 14‑1‑1980. The petitioner again filed a suit on 19‑2‑1980 for declaration that he did neither resign nor transfer his shares. The application for temporary injunction filed by the petitioner was allowed. This led to the filing of revision petition in the High Court, wherein. the pleas inter alia, taken by the respondent were that the earlier suit having been dismissed in .default the present suit was not maintainable and that the proper remedy for the petitioner was to seek remedy under section 38 of the Companies Act, 1913 and as such the plaint was liable to be rejected under Order VII, Rule 11, C.P.C. The revision filed under section 115, C . P. C . was ultimately disposed of by the learned Judge of the Peshawar High Court vide order dated 26‑3‑1983 directing that the plaint be returned to the petitioner for presentation before proper forum. The petitioner appears to have not pursued that suit further.

8. Then in April 1986 the petitioner filed these two petitions (C .0. No. 9 and 10 of 1986) in this Court seeking the reliefs noted above mainly on the basis that the letter dated 1‑4‑1985 furnished him with a fresh cause of action. Syed Jamat Ali Shah respondent in these two petitions categorically denied having signed or issued the said letter. He pointed out that the letter in question typed on the letter head of Universal Oil and Vegetable Ghee Mills Ltd. which was nationalized in 1973 was apparently a fake and forged letter as it does not bear any reference number as well. He also produced the transfer deed and the receipt signed by Salahuddin Khan acknowledging payment of Rs.2 lacs. The petitioners admitted his signatures appearing on these documents but he came out with the explanation that various blank papers were got signed from him by the respondent. Thus the questions whether the letter dated 1‑4‑1985 was issued and signed by Syed Jamat Ali Shah respondent and if so, whether he was authorised by the respondent company to issue the same, require to be determined. This will necessarily entail holding of detailed inquiry end recording of evidence in respect of the disputed factual assertions including the one that due to persuasion of common friends and relatives the respondent had promised to restore to the petitioner the disputed shares as well as the office of directorship. These questions cannot be gone into by this Court as the power vesting under section 152 of the Companies Ordinance, 1984 is not to be allowed to be invoked where the resolution of the questions raised require holding of detailed inquiry and going into complex questions of law and fact. In long series of judicial decisions this has been so held by the different High Courts in Pakistan as well as in India. See Jagan Nath v. Gopi Chand A I R 1915 Lah. 100, Peoples Insurance Company Ltd. v. M/s. C.R.E. Wood and Company Ltd. A I R 1960 Punj. 388, Smt. Soma Vati Devi Chand v. Krishna Sugar Mills Ltd. Delhi and others A I R 1966 Punj. 44, in the matter of Nelakhat Tea Company Ltd. A I R 1957 Cal. 476, Public Passenger Service Ltd. v. M.A. Khader A I R 1962 Mad. 276 and Shah Muhammad represented by legal heirs and 6 others v. Mst. Resham Bibi and 8 others 1986 CLC 2561. The aforesaid view is to be applied more particularly now in view of the provisions contained in section 9 of the Companies Ordinance, 1984 as subsection (3) of section 9 provides that the Court, in exercise of its jurisdiction, shall in all matters before it follow the summary procedure.

9. For another reason as well these petitions are bound to fail. It is to be noted that in both these petitions the cause of action allegedly accrued on account of the promise made in the letter dated First of April, 1985. The petitioner as such seeks enforcement of the promise so made. This being the position the case of the petitioner does not fall within the ambit of section 152 of the Companies Ordinance as in essence the question of rectification of register of members is not being agitated by a share‑holder whose name might have been fraudulently or without sufficient cause omitted from the register of members. The proceedings under section 152 of the Companies Ordinance are to be restricted to the correction of error or removal of defects or imperfections of the kind mentioned in the section. Again if the case be one of difficulties, complexities and complications it should more appropriately be left to be decided at a regular trial as this power is not intended for settling the controversies under several heads necessitating a regular investigation. It may be added B that whether judicial discretion should be exercised by the Court for purpose of directing or refusing the rectification of register of members depends on the facts of each particular case. I am clear in my mind that the instant case does not fall within the ambit of the provisions of section 152 of the Companies Ordinance as for all intent and purposes, specific performance is being sought of the promise made in the letter dated 1‑4‑1985. It is also pertinent to note that the dispute with regard to the transfer of shares etc was earlier agitated before the Civil Court twice by filing two suits and also before the High Court by filing a writ petition. The first suit was got dismissed as withdrawn and the second suit was not pursued after an order for returning the plaint was passed by the High Court. The question of legality of the order returning the plaint need not be gone into as those proceedings were not further pursued by the petitioner himself. The petitioner thereafter remained silent for almost three years. The present petition was then filed on the alleged fresh cause of action. The petition under section 152 of the Companies Ordinance for the reasons given above must, therefore, fail. As regards the other C petition filed under sections 186, 189 and 205 read with section 7 of the Companies Ordinance suffice it to say that the declaratory relief as well as the request to award punishment to the respondent cannot be allowed by this Court. Section 186 provides for penalties for non‑compliance of the provisions of sections 174 to 185 and for D imposition of these penalties the "authority" is to be approached and not the Court. Likewise for imposition of penalties under section 189, this Court is not to be approached.

10. For the reasons given above, both the petitions are dismissed. The parties are, however, left to bear their own costs.

11. The original documents i.e. receipt dated 6‑8‑1978 (Mark 'A'), letter of resignation dated 5‑8‑1978 (Mark 'B') and the original transfer deed (Mark 'C') be returned to the respondent and letter dated 1‑4‑1985 (Annex: 'P') be returned to the petitioner.

K . B . A . /S‑91/L Petition dismissed

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