Law: Companies Ordinance, 1984

Section: 160,476

Companies Ordinance (XLVII of 1984)--Ss. 160 & 476---Conducting special business by the Company---Failure to provide material information to the share-holders to understand said special business transaction---Effect---Enforcement Department, while examining the notice of the 38th Annual General Meeting observed Special Business proposed for approval of the share-holders---Security Exchange Commission required the company to provide important information necessary for share-holders to understand the transaction---Company conducted its Annual General Meeting without providing said material information either to the Commission or to the share-holders---In response to show-cause notice issued to the Chief Executive, Directors and Secretary of the Company; the Secretary of the Company appeared representing the Chief Executive and Directors of the Company and accepted the default under the provisions of S.160(1)(b) of the Companies Ordinance, 1984 requesting to condone the default and assured that the company would not proceed with the proposed transaction and the matter would be placed before the share-holders and in that way all the information would be available with the company, which would be provided to the share-holders through statement of material facts under S.160(1)(b) of the Companies Ordinance, 1984---Object of annexation of statement of material facts was that all members of the company must know as to what was the exact nature of the business to be transacted at the meeting so that they could make up their mind to attend the meeting considering the nature of business from their point of view and to make a conscious decision using their rights effectively---Default was established and admitted, however in view of the fact that the company had not proceeded with the transaction on assurance of the authorized representative that the company would convene a fresh meeting for the aforesaid business in which all material information would be provided to the share-holders---Taking lenient view, instead of penalizing the Chief Executive, Directors and Company Secretary the Commission condoned the violation with a stern warning---Directors were further…

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