Law:

Section:

(a) Undesirable Companies Act (X of 1958)-Within legislative competence of Parliament-Interpretation of Statutes-Enactment relating apparently to subjects within competence of two legislatures -Pith and substance of impugned legislation to be looked to, to determine which legislature is competent to legislate on those subjects -Constitution of Pakistan, Fifth Sched. item 8 of Federal List, and item 52 of Provincial List. Held, that the Undesirable Companies Act (X of 1958) was within legislative competence of Parliament. When an enactment apparently relates to subjects which are within the competence of two Legislatures, then, in order to determine the question of the validity of the legislation it is the pith and substance of the impugned legislation that is to be looked to. In the present case there was a simple method by which the 'competence of Parliament to enact this piece of legisla­tion could be determined. The question to be put was : if it was considered proper that companies running Imdad Schemes should be wound up and in future no company with such objects should be allowed to be registered, which Legis­lature was competent to legislate on the subject ? The obvious answer is : the Parliament (in respect of companies with objects not confined to one Province). The Provincial Legislature has no authority whatsoever to legislate as to the registration or the winding up of such companies. Incorporation, etc., of such companies fell under item 8 of the Federal List and not under item 52 of the Provincial List, Fifth Schedule, Constitution of Pakistan. (b) Constitution of Pakistan, Art. 10-Right to form "com­pany" covered by Article-rohibiting formation of "Imadadi Scheme" companies-Prohibition held to be in interest of morality and reasonable in so far as such companies engender spirit of gambling amongst public-Undesirable Companies Act (X of 1958). Having regard to the ordinary meaning of the word `associa­tion' and to the meaning which is generally assigned to it in legal literature, Art. 10 of the Constitution of Pakistan includes the formation of companies. In Wharton's Law Lexicon `company' is described as a body of persons associated for the…

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