Law: Companies Ordinance, 1984

Section: 231

(a) Companies Ordinance (XLVII of 1984)--Ss. 231, 476 & 484---Securities and Exchange Commission of Pakistan Act (XLII of 1997), S. 33---Constitution of Pakistan, Art. 199---­Constitutional petition---Inspection of books of account of company---Order of Securities and Exchange Commission for making such inspection passed on basis of written complaint of Directors/shareholders regarding delayed payment of dividends by company---Petitioner's plea that before passing such order, he was neither issued show-cause notice nor provided an opportunity of hearing---Validity---Exercise of powers under S.231 of Companies Ordinance, 1984 by Commission was administrative in nature and limited to inspection and conducting of preliminary inquiry into affairs and accounts of a company---Legislature had neither provided for issuance of show-cause notice before invoking provision of S.231 of Companies Ordinance, 1984 nor could same be read therein as no adverse action was stipulated therein---Registrar or authorized officer of the Commission, in order to ensure compliance of provisions of Companies Ordinance, 1984 could invoke provision of S. 231 thereof against a company by assigning reasons in writing---Mere issuance of an administrative order or inspection of accounts by Registrar or authorized officer would neither require any show-cause notice or hearing nor amount to an adverse order against a company---­Defaulting company would be entitled to a show-cause notice and/or right of hearing before invoking any consequential provisions of Companies Ordinance, 1984 in case of violation and non-compliance of its provisions--- Impugned order was not illegal or mala fide---Person aggrieved by an order other than an order under S. 476 of Companies Ordinance, 1984 could challenge same by filing revision before Commission under S.484 thereof, and he could abandon or bypass such statutory remedy without any lawful excuse or justification---High Court dismissed the constitutional petition and observed that pursuant to such inspection, if any action was likely to be taken against petitioner, then same be provided an opportunity of hearing and matter be decided strictly in accordance…

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