| Citation(s) |
|---|
| 2021 SLG 226 2021 SLD 226 2021 CLD 134 |
Sindh High Court
J.C.M. No. 33 of 2019, decided on 16th April, 2020, Dates ofhearing: 21st January, 10th and 18th March, 2020.
MUHAMMAD, JUNAID GHAFFAR, JUSTICE
Kazim Hassan and Shahan Karimi for Petitioners.Arshad Tayebaly, Waqar Ahmed and Heer Memon for
Respondent.
J.C.M. No. 33 of 2019, decided on 16th April, 2020, Dates ofhearing: 21st January, 10th and 18th March, 2020.
MUHAMMAD, JUNAID GHAFFAR, JUSTICE
Kazim Hassan and Shahan Karimi for Petitioners.Arshad Tayebaly, Waqar Ahmed and Heer Memon for
Respondent.
MUHAMMAD YOUSUF AHMED AND 5 OTHERSVSARTISTIC DENIM MILLS LIMITED
Law: Companies Act, 2017
Section: 136,131,132,133,2(66),134,135,
(a) Companies Act (XIX of 2017)---
----Ss. 136, 131, 132 133---Meetings and proceedings of company---Statutory meeting of company--- Annual General Meeting----Extraordinary General Meeting---Power of the court to declare the proceedings of a general meeting invalid---Scope---Section 136 of Companies Act, 2017 provided two sets of remedies, first of which related to material defect or omission in notice of a meeting---In the present case, petitioner under S. 136 of Companies Act, 2017 ought to approach court as soon as such notice was issued and before such meeting took place, however there existed no bar to impugning such notice subsequent to the meeting being held---Principles.
Pfizer Laboratories Ltd. and anothers 2003 CLD 1209; M. Shahid Saigol and 16 others v. M/S Kohinoor Mills Ltd. and 7 others PLD 1995 Lah. 264; Central Cotton Mills Limited and 2 others v. Naveed Textile Mills Limited and another 1996 MLD 1943; Naveed Textile Mills Ltd. Karachi and 3 others v. Central Cotton Mills Limited, S.I.T.E Kotri, District Dadu and 2 others PLD 1997 Kar. 432; M/S Kingsway Capital LLP and another v. Murree Brewery Co. Ltd. and 10 others 2017 CLD 587; Parshuram Dattaram Shamdasani and others v. Tata Industrial Bank, Ltd. and others 1925 Bombay 49; National Investment Trust Ltd. and another v. Crescent Textile Mills Ltd. 2010 CLD 1675; Parshuram Detaram Shamdasani and another v. Tata Industrial Bank, Ltd. and others AIR 1928 Privy Council 180 and Dewan Salman Fibre Limited v. Dewan Petroleum (Pvt.) Limited 2016 CLD 1049 ref.
(b) Companies Act (XIX of 2017)---
----Ss. 2(66), 134, 135 136---Special Resolution of a company---For passing of a special resolution, requirement of 75% votes in favour was not to be computed from entire shareholding of a company; but from amongst shareholders present in a particular meeting. [p. 148] B,
Kazmia Trust (Regd.) v. Kaz International (Pvt.) Limited 2009 CLD 1713 rel.
(c) Company---
----Corporate governance---Principles---Adjudication by courts on matters of shareholder disputes/corporate governance---Judicial oversight on conduct of companys affairs---Scope---For a court dealing with company matters, if the thing complained before it of was a thing which in substance majority of the company was entitled to do, or if something had been done irregularly which majority of the company was entitled to do regularly, or if something had been done illegally which the majority of the company was entitled to do legally, then there existed no use for litigation about such matter as ultimate end of such matters was only that a meeting had to be called, and then ultimately majority got its wishes---Individual shareholder could not bring an action before courts to complain of an irregularity (as distinct from an illegality) in conduct of the companys internal affairs provided that such irregularity was one which could be cured by a vote of company in a general meeting---Court was to be reluctant to give relief where to do so would provided no concrete result.
Macdougall v Gardiner [1875] 1 Ch.D. 13; Foss v Harbottle (1843) 67 ER 189 and Bentley-Stevens v. Jones [1974] 1 W.L.R. 638 rel.
----Ss. 136, 131, 132 133---Meetings and proceedings of company---Statutory meeting of company--- Annual General Meeting----Extraordinary General Meeting---Power of the court to declare the proceedings of a general meeting invalid---Scope---Section 136 of Companies Act, 2017 provided two sets of remedies, first of which related to material defect or omission in notice of a meeting---In the present case, petitioner under S. 136 of Companies Act, 2017 ought to approach court as soon as such notice was issued and before such meeting took place, however there existed no bar to impugning such notice subsequent to the meeting being held---Principles.
Pfizer Laboratories Ltd. and anothers 2003 CLD 1209; M. Shahid Saigol and 16 others v. M/S Kohinoor Mills Ltd. and 7 others PLD 1995 Lah. 264; Central Cotton Mills Limited and 2 others v. Naveed Textile Mills Limited and another 1996 MLD 1943; Naveed Textile Mills Ltd. Karachi and 3 others v. Central Cotton Mills Limited, S.I.T.E Kotri, District Dadu and 2 others PLD 1997 Kar. 432; M/S Kingsway Capital LLP and another v. Murree Brewery Co. Ltd. and 10 others 2017 CLD 587; Parshuram Dattaram Shamdasani and others v. Tata Industrial Bank, Ltd. and others 1925 Bombay 49; National Investment Trust Ltd. and another v. Crescent Textile Mills Ltd. 2010 CLD 1675; Parshuram Detaram Shamdasani and another v. Tata Industrial Bank, Ltd. and others AIR 1928 Privy Council 180 and Dewan Salman Fibre Limited v. Dewan Petroleum (Pvt.) Limited 2016 CLD 1049 ref.
(b) Companies Act (XIX of 2017)---
----Ss. 2(66), 134, 135 136---Special Resolution of a company---For passing of a special resolution, requirement of 75% votes in favour was not to be computed from entire shareholding of a company; but from amongst shareholders present in a particular meeting. [p. 148] B,
Kazmia Trust (Regd.) v. Kaz International (Pvt.) Limited 2009 CLD 1713 rel.
(c) Company---
----Corporate governance---Principles---Adjudication by courts on matters of shareholder disputes/corporate governance---Judicial oversight on conduct of companys affairs---Scope---For a court dealing with company matters, if the thing complained before it of was a thing which in substance majority of the company was entitled to do, or if something had been done irregularly which majority of the company was entitled to do regularly, or if something had been done illegally which the majority of the company was entitled to do legally, then there existed no use for litigation about such matter as ultimate end of such matters was only that a meeting had to be called, and then ultimately majority got its wishes---Individual shareholder could not bring an action before courts to complain of an irregularity (as distinct from an illegality) in conduct of the companys internal affairs provided that such irregularity was one which could be cured by a vote of company in a general meeting---Court was to be reluctant to give relief where to do so would provided no concrete result.
Macdougall v Gardiner [1875] 1 Ch.D. 13; Foss v Harbottle (1843) 67 ER 189 and Bentley-Stevens v. Jones [1974] 1 W.L.R. 638 rel.
ORDER
MUHAMMAD JUNAID GHAFFAR, JUSTICE:---.---
This is a Petition under section 136 of the Companies Act, 2017 (“The Act”) through which the Petitioners have sought the following relief(s):-
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