The Companies Act, 1994

Act No. 18 of 1994

(Published by Notification No. S ! 1""#la$ dated 1#1%#9&. of 'inist(y of Comme(ce)
(See section 4%4) An Act to consolidate and amend the law relating to companies and certain other associations.

WHEREAS it is expedient to consolidate and amend the law relating to companies and certain other Associations;

It is hereby enacted as follows: PA T#* P +,*'*NA 1. Sho(t title and commencement !" #his Act may be called the $ompanies Act% !&&'. (" It shall come into force on s)ch rate as the *o+ernment may% by notification in the ,fficial% *a-ette% appoint. .. /efinitions !" In this Act% )nless there is anything rep)gnant in the s)b.ect or context%/ a" 0articles0 means the articles of association of a company incl)ding% so far as they apply to the company% the reg)lations contained in Sched)le I to this Act. : 1ro+ided that the article of association of a company framed )nder any law relating to companies at any time in force before the commencement of this Act shall% so far as they are not inconsistent with the pro+isions of this Act% be deemed to be the articles of association of that company framed in accordance with the pro+isions of the Act: b" 0ban2ing company0 means a ban2 company as defined in section 3 &" of the Act% !&&! Act 4o. !' of !&&!". c" 0company0 means a company formed and registered )nder this Act or an existing company; d" 0#he $o)rt0 means the $o)rt ha+ing .)risdiction )nder this Act; e" 0debent)re0 incl)des debent)re stoc2% bonds and any other sec)rities of a company% whether constit)ting a charge on the assets of company or not;

f" 0director0 incl)des any person occ)pying the position of director by whate+er name called; g" 05istrict $o)rt0 means the principle $i+il $o)rt of original .)risdiction in a district% b)t does not incl)de the High $o)rt 5i+ision% in the exercise of its ordinary ci+il .)risdiction; h" 0existing company0 means a company formed and registered )nder any law relating to companies in force at any time before the commencement of this Act% and is in operation after commencement of this Act% i" 0financial year0 means% in relation to any body corporate% the period in respect of which any profit and loss acco)nt of the body corporate laid before it in ann)al general meeting is made )p% whether that period is a year or not; 1ro+ided that in relation to an ins)rance company% 0financial year0 shall mean the calendar year; ." 0ins)rance company0 means a company that carries on the b)siness of ins)rance either solely or in common. with any other b)siness or b)sinesses; 2" 0manager0 means an indi+id)al who% s)b.ect to the s)perintendence% control and direction of the 6oard of 5irectors% has the management of the whole% or s)bstantially the whole% of the affairs and b)siness of a company % and incl)des a director or any other person occ)pying the position of a manager% by whate+er name called% and whether )nder a contract of ser+ice or not; l" 0managing agent7 means a person% firm or company by whate+er name called% who or which is entitled to the management of the whole affairs and b)siness of a company by +irt)e of an agreement with the company% and )nder the control and direction of the directors except to the extent% if any% otherwise pro+ided for in the agreement; m" 0managing director0 means a director who% by +irt)e of an agreement with the company or of a resol)tion passed by the company in its general meeting or by its directors or by +irt)e of its memorand)m or articles of association% is entr)sted with the s)bstantial powers of management which wo)ld not otherwise be exercisable by him and incl)des a director occ)pying the position of a managing director by whate+er name called; 1ro+ided that the powers to do administrati+e acts of a ro)tine nat)re when so a)thorised by the directors s)ch as the power to affix common seal of the company to any doc)ment or to draw and endorse any che8)e on the acco)nt of the company in any ban2 or to draw and endorsed negotiable instr)ment or to sign any certificate of share or to direct registration of transfer of any shares shall not be deemed to be incl)ded within the s)bstantial powers of management: 1ro+ided f)rther that a managing director of a company shall exercise his powers s)b.ect to the s)perintendent control and direction of the directors. n" 0memorand)m0 means the memorand)m of association of a company as originally framed or as altered in p)rs)ance of the pro+isions of this Act; o" 0officer0 means a director% managing agent% manager secretary or any other officer of a company and also incl)des// i" where the managing agent is a firm any partner in the firm; ii" where the managing agent is a body corporate% any director or manager of the body corporate;

iii" where the secretary is a body corporate; 1ro+ided that. except for the p)rpose of sections 99!% 99(% and 999% the form 0officer0 shall not incl)de an a)ditor.; p" 0prescribed0 means as respects the pro+isions of this Act relating to the winding )p of companies% prescribed by r)les made by the S)preme $o)rt and% as respect the other pro+isions of this Act% prescribed by the *o+ernment; 8" 0pri+ate company0 means a company which by its articles// i" restricts the right to transfer its shares% if any; ii" prohibits any in+itation to the p)blic to s)bscribe for its shares or debent)re% if any; iii" limits the n)mber of its members to fifty not incl)ding persons who are in its employment; 1ro+ided that where two or more persons hold one or more shares in a company .ointly% the shall% for the p)rposes of this definitation be treated as a single member; r" 0p)blic company0 means a company incorporated )nder this Act or )nder any law at any time in force before the commencement of this Act and which is not a pri+ate company; s" 0Registrar0 means a Registrar or any other officer% by whate+er designation% performing )nder this Act the d)ty of registration of companies; f" 0Sched)le0 means a sched)le to this act; )" 0secretary0 means any indi+id)al possessing the prescribed 8)alifications appointed to perform the d)ties which may be performed by a secretary )nder this Act and any other ministerial or administrati+e d)ties% and +" 0share0 means a share in the capital of the company% and incl)des stoc2 except when a distinction between stoc2 and shares is expressed or implied. (" :or the p)rposes of this Act% a company shall s)b.ect to the pro+isions s)b/section '"% be deemed to be a s)bsidiary of another% if// a" that other contrats the composition of 6oard of 5irectors of the first mentioned company. b" the first mentioned company% being an existing company% has before the commencement of this Act% iss)ed preference shares the holders of which ha+e the same +oting right in all respects as the holders of e8)ity shares and that other company exercises or controls more than half of the total +oting power of the first mentioned company; or c" the first mentioned company is not a s)bsidiary within the meaning of cla)se b"% b)t that other company holds more than half in nominal +al)e of its e8)ity share;capital; or d" the first mentioned company is a s)bsidiary of a third company with is that other7s s)bsidiary. 9" :or the p)rposes of s)b/section ("% the composition of a company7s 6oard of 5irectors shall be deemed to be controlled by another company if% that other company% by the exercise of some

power exercisable by it at its discretion witho)t the consent or conc)rrence of any other person% can appoint or remo+e the holders of all or a ma.ority of the directors% and for the p)rposes of this s)b/section that other company shall be deemed to ha+e power to appoint to a directorship with respect to which any of the following conditions is satisfied% that is to say// a" that power of appointment cannot be exercised except in fa+o)r of an indi+id)al% b"" that an indi+id)als appointment thereto follows necessarily from his appointment as director% managing agent% secretary or manager of or to any other office of employment in% that other company; or c" that the directorship is held by an indi+id)al nominated by that other company or a s)bsidiary thereof. '" In determining whether one company is a s)bsidiary of another the following conditions shall be applicable namely:// a" any shares held or power exercisable by that other company in a fid)ciary capacity shall be treated as not held or exercisable by it. b" s)b.ect to the pro+isions of cla)ses c" and d" any shares held or power exercisable shall be deemed to be the shares held or power exercisable by that other company% if// i" the shares are held or the power is excercisable by a person as a nominee and on behalf of that other company% b)t this cla)se shall not apply to the holding of s)ch shares or to the exercise of s)ch powers by s)ch person where that other company is concerned in a fid)ciary capacity. ii" the shares are held or the power is exercisable by a s)bsidiary of that other company or by a nominee of s)ch s)bsidiary% b)t this cla)se shall not apply to the holding of s)ch shares or to the exercise of s)ch powers by the s)bsidiary or by its nominee where the s)bsidiary is concerned in a fid)ciary capacity; c" any shares held or power exercisable by any person by +irt)e of the pro+isions of any debent)res of the first/mentioned company or of a tr)st deed for sec)ring any iss)e of s)ch debent)res shall disregarded; d" if any shares are held or power is exercisable% not being held of exercisable as mentioned in cla)se c"%// i" by that other company or by its s)bsidiary or by a nominee of that other or its s)bsidiary as the case may be% and ii" the ordinary b)siness of that other company or as the case may be of its s)bsidiary incl)des the lending of money and s)ch shares are held or the power is exercisable by way of sec)rity of the loan <then s)ch power shall not be treated as being held or exercisable by s)ch company or its nominee.= 3" :or the p)rposes of this Act7 a company shall be deemed to be the holding company of another if% and only if% that other is its s)bsidiary. 0. 1u(isdiction of the Cou(t. !" #he $o)rt ha+ing .)risdiction )nder this Act shall be High $o)rt 5i+ision; '

1ro+ided that the *o+ernment may be notification in the ,fficial *a-ette and s)b.ect to s)ch restrictions and conditions as it thin2s fit% empower any 5istrict $o)rt to exercise all or any of the .)risdiction by this Act conferred )pon the $o)rt% and in that case s)ch 5istrict $o)rt shall as regards the .)risdiction so conferred% be the $o)rt in respect of all companies ha+ing their registered office in the district. Explanation.##:or the p)rposes to wind )p companies the expression 0registered office0 means the place where the registered office of the company% d)ring the six months immediately preceding the presentation of the petition of winding )p was sit)ated. (" 4othing in this section shall in+alidate a proceeding by reason of its being ta2en in a wrong $o)rt

PA T#** C!NST*T2T*!N AN/ *NC! P! AT*!N

4. P(ohibition of pa(tne(ship e3ceedin4 ce(tain numbe(5 !" 4or company% association or partnership consisting of more than ten persons shall be formed or a the p)rpose of carrying on the b)siness of ban2ing )nless it is registered as a company )nder this Act or is formed by or )nder any other Act of 1arliament. (" 4o company association or partnership consisting of more than twenty persons shall be formed for the p)rpose of carrying on any other b)siness that has for its ob.ects the ac8)isition of gain by the company% association or partnership% or by the indi+id)al members thereof )nless it is registered as a company )nder this Act or is formed by or )nder any other Act of 1arliament. 9" #his section shall not apply to .oint family carrying on .oint family b)siness or trade. 1ro+ided that for the p)rposes of this section% in comp)ting the n)mber of persons of a partnership% association or company comprising two or more .oint families% minor members of s)ch families shall be excl)ded. '" E+ery member of a company% association or partnership carrying on b)siness in contra+ention of this section shall be personally liable for all liabilities inc)rred in s)ch b)siness. 3" Any person who is a member of a company% association or partnership formed contra+ention of this section shall be p)nishable with fine not exceeding fi+e tho)sand ta2a. 'emo(andum of Association &. 'ode of fo(min4 inco(po(ated company. Any se+en or more persons or% where the company to be formed will be a pri+ate company% any two or more persons associated for any lawf)l p)rpose may% be s)bscribing their names to a memorand)m of association and otherwise with the re8)irements of this Act in respect or registration form an incorporated company% with or witho)t limited liability% that is to say% either// in

a" a company limited by shares% that is to say% a company ha+ing the liability of its member limited by the memorand)m to the amo)nt% if any% )npaid on the shares respecti+ely held by them; or b" a company limited by g)arantee% that is to say% a company ha+ing the liability of its members limited by the memorand)m to s)ch amo)nt as the members may respecti+ely thereby )nderta2e to contrib)te to the assets of the assets of the company on the e+ent of its being wo)nd )p; or c" an )nlimited company% that is to say% a company ha+ing no limit on the liability of its members. 6. 'emo(andum of company limited by sha(ees. In the case of a company limited by shares./ a" the memorand)m shall state.// i" the name of the company% with 0limited0 as the last word in its name; ii" #he address of the registered office; iii" the ob.ects of the company% and% except in the case of trading companies% the territories to which they extend; i+" that the liability of the members is limited; +" the amo)nt of share capital with which the company proposes to be registered% and the di+isions thereof into shares of a fixed amo)nt; b" each s)bscriber of the memorand)m shall ta2e at least one share; c" each s)bscriber shall write opposite to his name the n)mber of shares he ta2es. ". 'emo(andum of company limited by 4ua(antee. In the case of a company limited by g)arantee// a" the memorand)m shall state// i" the name of the company% with 0limited0 as the last word in its name. ii" the address of the registered office; iii" the ob.ects of the company% and% except in the case of trading companies% the territories to which they extend; i+" that the liability of the members is limited; +" that each member )nderta2es to contrib)te to the assets of the company in the e+ent of its being wo)nd )p while he is a member or within one year afterwards% for payment of the debts and liabilities of the company contracted before he ceases to be a member% ad of the charges and expenses of winding )p% and for ad.)stment of the right of the

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contrib)tories among themsel+es% s)ch amo)nt as may be re8)ired% not exceeding a specified amo)nt; b" if the company has a share capital// i" the memorand)m shall also state the amo)nt of share capital with which the company proposes to be registered and the di+ision thereof into shares of a fixed amo)nt; ii" each s)bscriber of the memorand)m shall ta2e at least one share; iii" each s)bscriber shall write opposite to his name the n)mber of shares he ta2es. 8. 'emo(andum of unlimited company. In the case of an )nlimited company a" the memorand)m shall state/ i" the name of the company; ii" the address of the registered office of the company; iii" the ob.ects of the company and% except in the case of trading companies% the territories to which they extend. b" if the company has a share capital/ i" each s)bscriber of the memorand)m shall ta2e at least one share; ii" each s)bscriber shall write opposite to his name the n)mber of shares he ta2es. 9. P(intin4 and si4natu(e of memo(andum. #he memorand)m of e+ery company shall// a" be printed; b" be di+ided into paragraphs n)mbered consec)ti+ely; and c" be signed by each s)bscriber% who shall add his address and description in the presence of at least two witnesses who shall attest the signat)re.

1%.

est(iction on alte(ation of memo(andum.

!" A company shall not alter the conditions on contin)ed in its memorand)m except pro+isions is made in the Act. (" ,nly those pro+isions which by any other specific pro+ision contained in this Act% are re8)ired to be stated in the memorand)m of the company concerned shall be deemed to be the conditions contained in its memorand)m.

9" ,ther pro+isions contained in the memorand)m% incl)ding those relating to the appointment of director% managing agent or manager may be altered in the same manner as the articles of the company% b)t if there is any express pro+ision in this Act permitting the alteration of s)ch pro+isions in any other manner% they may also be altered in s)ch other manner. '" All reference to the articles of a company in this Act shall be constr)ed as incl)ding references to the other pro+isions contained in its memorand)m as referred to in s)b/section 9". 11. Name of company and chan4e of name. !" A company shall not be registered by a name identical with that by which a company in existence is already registered% or so nearly resembling the name that there is li2elihood of )sing the name to decei+e% except where the company in existence is in the co)rse of being dissol+ed and signifies its written consent in s)ch manner as the Registrar re8)ires. (" If a company% thro)gh inad+ertence or otherwise% is% witho)t the consent referred to in s)b/ section !"% registered by a name identical with that by which a company in existence is pre+io)sly is registered% or so nearly resembling the name that there is li2elihood of )sing the name to decei+e% the first mentioned company shall% on he direction of the Registrar% change its name within a period of one h)ndred and twenty days. 9" If a company ma2es a defa)lt in complying with the direction made )nder s)b/section ("% the company shall be p)nishable with fine of fi+e h)ndred ta2e for e+ery day d)ring which the defa)lt contin)es and e+ery officer who is in defa)lt shall be p)nishable with fine of one h)ndred ta2a for e+ery day d)ring which the defa)lt contin)es. '" Except with the pre+io)s consent in writing of the *o+ernment% no company shall be registered by a name which is declared by the *o+ernment by notification in the official *a-ette% as )ndesirable: 1ro+ided that nothing in this s)b/section shall apply to companies registered before the commencement of this Act. 3" 4o company shall be registered by a name containing in any form the name or any abbre+iation of the name of the @nited 4ations or of any s)bsidiary body set )p by the @nited 4ations or of the World Health ,rganisation )nless the company has obtained the pre+io)s a)thorisation in writing of the Secretary *eneral in the case of the @nited 4ations or the s)bsidiary body as aforesaid or of the 5irector *eneral of the World Health ,rganisation in the case of that ,rganisation. >" Any company may% by special resol)tion and s)b.ect to the appro+al of the Registrar signified in writing% change it name. ?" Were a company changes its name% the Registrar shall enter the new name on the register in place of the former name% and shall iss)ed a certificate of incorporation in its new name to meet the circ)mstances of the case and on the iss)e of s)ch a certificate% the change of name shall be complete. A" #he change of name shall not change any rights or obligations of the company% or render defecti+e any legal proceedings by or against the company; and any legal proceedings that might ha+e been contin)ed or commenced against it by its former name may be contin)ed or commenced against it by its new name.

&" A company may% on payment of s)ch fee as may be prescribed% apply to the Registrar for information whether any company is registered or proposed to be registered by a name specified in the application and the Registrar shall f)rnish the re8)ired information within a period of thirty days from the date of receipt of the application. 1.. Alte(nation of memo(andum. !" S)b.ect to the pro+isions of this Act% a company may% by special resol)tion% alter the pro+isions of its memorand)m with respect to the ob.ects of the company% so far as may be re8)ired to enable it// a" to carry on its b)siness more economically or more efficiently; or b" to attain its main p)rpose by new or impro+ed means; or c" to enlarge or change the local area of its operations; or d" to carry on some b)siness which% )nder the existing circ)mstances. may con+eniently or ad+antageo)sly be combined with the b)siness of the company; or e" to restrict or abandon any of the ob.ects specified in the memorand)m; or f" to sell or dispose of the whole or any part of the )nderta2ing of the company; or g" to amalgamate with any other company or body of persons. (" #he alteration shall not ta2e effect )ntil and except in so far it is confirmed by the $o)rt on petition. 9" 6efore confirming the alteration% the $o)rt m)st be satisfied// a" that s)fficient notice has been gi+en to e+ery holder of debent)res of the company% and to any person or class of person whose interest will% in the option of the $o)rt% be affected by the alteration; and b" that% with respect to e+ery creditor who in the opinion of the $o)rt is entitled to ob.ect% and who signifies his ob.ections in manner directed by the $o)rt% either his consent to the alteration has been obtained or his debt or claim has been discharged or has been determined% or has been sec)red to the satisfaction of the $o)rt; 1ro+ided that the $o)rt may% in the cases of any person or class% for special reasons% dispense with the notice re8)ired by this section.

10. Po$e( of Cou(t $hen confi(min4 alte(ation. #he $o)rt may ma2e an order confirming the alteration either wholly or in part% and on s)ch terms and conditions as it thin2s fit% and may ma2e s)ch order as to costs as it thin2s proper. 14. +3e(cises of disc(etion by Cou(t.

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#he $o)rt shall% in exercising its discretion )nder sections !( and !9% ha+e regard to the class of them% as well as to the rights and interests of the creditors% and may if it thin2s fit% ad.o)rn the proceedings in order that an arrangement may be made to the satisfaction of the $o)rt for the p)rchase of the interests of dissenting members; and may gi+e s)ch directions and ma2e s)ch orders as it may thin2 expedient for facilitating or carrying into effect any s)ch arrangement; 1ro+ided that no part of the share capital of the company may be expended in any s)ch p)rchase. 1&. P(ocedu(e on confi(mation of the alte(nation. A certified copy of the order confirming the alternation% together with a printed copy of the memorand)m as altered% shall be filed by the company with the Registrar within ninety days from the date of the order or within s)ch time as may be extended by the co)rt% and he Registrar shall register the same. and shall certify the registration )nder his hand% and the certificate shall be concl)si+e e+idence that all the re8)irements of this Act% with respect to the alteration and the confirmation thereof% ha+e been complied with% and hence forth the memorand)m so altered shall be the memorand)m of the company. 16. +ffect of failu(e to (e4iste( $ithin e3tended time.## 4o s)ch alteration shall ha+e any operation )ntil registration thereof has been d)ly effected in accordance with the pro+isions of section !3% and if s)ch registration is not effected within the period specified in that section s)ch alteration and the order of the $o)rt confirming the alteration% and all proceedings connected there with shall% at the expiration of the period specified )nder that section become absol)tely n)ll and +oid : 1ro+ided that the $o)rt may% on s)fficient ca)se shown% re+i+e the order on application made within a f)rther period of thirty days after the said period. A(ticles of Association, 1". e4ist(ation of a(ticles.

!" A company limited by g)arantee and an )nlimited company shall% and a company limited by shares may. ha+e an articles of association herein pro+ision shall be made for reg)lating the affairs of the company; and the article shall be signed by the s)bscribers of the memorand)m and be registered together with the memorand)m. (" Articles of association may adopt all or any of the reg)lations contained in Sched)le I% and shall in any e+ent be deemed to contain reg)lations identical with or to the same effect as reg)lation 3>% >>% ?!% ?A% ?&% AB% A!% A(% &3% &?% !B3% !BA% !!(% !!9% !!'% !!3% and !!> contained in that Sched)le : 1ro+ided that reg)lations ?A% ?&% A(% A!% and A( shall not be deemed to be incl)ded in the articles of any pri+ate company except a pri+ate company which is the s)bsidiary company of a p)blic company : 1ro+ided f)rther that reg)lation% !BA shall be deemed to re8)ire that a statement of the reasons why of the whole amo)nt of any item of expendit)re which may in fairness be distrib)ted o+er se+eral years% only a portion thereof is charged against the income of the year% shall be shown in the profit and% loss acco)nt% )nless the company in general meeting shall determine otherwise.

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9" In the case of an )nlimited company or a company limited by g)arantee% the articles% if the company has a share capital% shall state the amo)nt of share capital with which the company proposes to be registered. '" In the case of an )nlimited company or a company limited by g)arantee% if the company has not a share capital% the articles shall state the n)mber of members with which the company proposes to the registered; and on the basis of s)ch n)mber the Registrar shall determine the fees payable on registration. 18. Application of Schedule *. In the case of a company limited by shares and registered after the commencement of this Act% if articles not registered% or% if articles are registered% in so far as the articles do not excl)de or modify the reg)lations in Sched)le I% those reg)lations shall% so far as applicable be the reg)lations of the company in the same manner and to the same extent as if they were contained in the d)ly registered articles. 19. 7o(m and si4natu(e of a(ticles. Articles shall a" be printed; b" be di+ided into paragraphs n)mbered consec)ti+ely; c" be signed by each s)bscriber of the memorand)m% who shall add his address and description in the presence of at least two witness who shall attest the signat)re. .%. Alte(ation of a(ticles by special (esolution. S)b.ect to the pro+isions of this Act and to the conditions contained in its memorand)m% a company may by special resol)tion alter% excl)de from or add to its articles: and any alteration% excl)sion or addition so made shall be as +alid as if originally contained in the articles% and be s)b.ect in li2e manner to alteration% excl)sion or addition by special resol)tion. .1. +ffect of alte(ation in memo(andum o( a(ticles. 4otwithstanding any thing in the memorand)m or articles of a company%% no member of the company shall be bo)nd by an alteration made in the memorand)m or articles after the d)e on which he becomes% member% if and so far as the alteration re8)ires him to ta2e or s)bscribe for more shares than the n)mber held by him at the date on which the alteration is made% or in any way increases his liability is at that date to contrib)te to the share capital of% or otherwise to pay money to the company.

8ene(al P(o9isions ... +ffect of memo(andum and a(ticles.

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!" #he memorand)m and articles shall when registered bind the company and the members hereof to the same extent as if they respecti+ely had been signed by each member and contained a con+enient on the part of each member his heirs and leal representati+es to obser+e all the pro+isions of the memorand)m and of the articles s)b.ect to the pro+isions of this Act. (" All money payable by any member to the company )nder the memorand)m or articles shall be a debt one from him to the company. .0. e4ist(ation of memo(andum and a(ticles.

!" #he memorand)m and articles if any shall be field with the Registrar who if satisfied that the re8)irements of this Act ha+e been complied with shall retain and register them within thirty days from the date of their receipt and in the e+ent of ref)sal he shall comm)nicate the gro)nds within ten days after that period to the company. (" An person on being aggrie+ed by a ref)sal of the Registrar )nder s)b/section !" may ma2e an appeal to the *o+ernment within thirty days of the receipt of the ref)sal order. 9" #he petition of appeal shall be accompanied by a treas)ry challan showing of a fee of two h)ndred fifty ta2a to be credited )nder the head of acco)nt specified in this behalf. '" #he decision of the *o+ernment in an appeal )nder this section shall be final. .4. +ffect of (e4ist(ation. !" ,n the registration of the memorand)m of a company the Registrar shall certify )nder his hand that the company is incorporated and in the case of a limited company that the company is limited. (" :rom the date of incorporation mentioned in the certificate of incorporation the s)bscribers of the memorand)m together with s)ch other persons as may from time to time become members of the company shall be a body corporate by the name contained in the memorand)m capable forthwith of exercising all the f)nctions of an incorporated company and ha+ing perpet)al s)ccession and a common seal b)t with s)ch liability on the part of the members to contrib)te to the assets of the company in the e+ent of its being wo)nd )p as is mentioned in this Act. .&. Conclusi9eness of ce(tificate of inco(po(ation. !" A certificate of incorporation gi+en by the Registrar in respect of any association shall be concl)si+e e+idence that all the re8)irements of this Act in respect of registration and of matters precedent and incidental thereto ha+e been complied with and that the association is a company a)thorised to the registered and d)ly registered )nder this Act. (" A declaration by an ad+ocate entitled to appear before the High $o)rt 5i+ision who is engaged in the formation of a company or by a person named in the articles as a director manager or secretary of the company of compliance with all or any of the said re8)irements shall be filed with the Registrar and the Registrar may accept s)ch a declaration as s)fficient e+idence of compliance. .6. Copies of memo(andam and a(ticles to be 4i9en to membe(s. !" E+ery member of a company may re8)est for a copy of the memorand)m% and also for a copy of the articles% if any% and if s)ch re8)est is made in writing alongwith a fee of ta2a fifty or s)ch

!(

less fee as may fixed by the company% the company shall% within fo)rteen days from the date of s)ch re8)est% send the copy to that member. (" If a company ma2es defa)lt in complying with the re8)irements of this section% it shall be liable for each offence to a fine not exceeding two h)ndred ta2a and e+ery officer of the company who is 2nowingly and willf)lly in defa)lt shall be liable to li2e penalty. .". Alte(ation of memo(andum of a(ticles to be noted in e9e(y copy. !" Where an alteration is made in the memorand)m or articles of a company% e+ery copy of the memorand)m or articles iss)ed after the date of the date of the alteration shall be in accordance with the alteration. (" If% where any s)ch alteration has been made the company at any time after the date of the alteration% iss)es any copies of the memorand)m or article which are not in accordance with the alteration% it shall be liable to a fine not exceeding one h)ndred ta2a for each copy so iss)ed% and e+ery officer of the company who is 2nowingly and willf)lly in defa)lt shall also bearable to a li2e penalty. Association not fo( p(ofit .8. Po$e( to dispense $ith ,imited *n name of cha(itable and othe( companies. !" Where it is pro+ed to the satisfaction of the *o+ernment that an association capable of being formed as a limited company has been or in abo)t to be formed for promoting commerce% art% science% religion% charity% or any other )sef)l ob.ect% and appllies or intends to apply its profits% if any or other income in promoting its ob.ects and to prohibit the payment of any di+idence to its membners the *o+ernment may% by licence with appro+al of one of its Secretaries% direct that the association be registered as a company with limited liability% witho)t the addition of the word 0Cimited0 to its name% and the association may be registered accordingly. (" A licence by the *o+ernment )nder this section may be granted on s)ch conditions and s)b.ect to s)ch restrictions as the *o+ernment thin2s fit and those conditions and restrictions shall be binding on the association and shallif the *o+ernment so directs be inserted in the memorand)m and articles or in one of those doc)ments. 9" #he association shall on registration en.oy all the pri+)leges of limited companies and be s)b.ect to all their obligations except those of )sing the word 0Cimited0 as any part of its name and of p)blishing its name or of sending lists of members to the Registrar. '" A licence )nder this section may at any time be cancelled by the *o+ernment and )pon cancellation the Registrar shall enter the word 0Cimited0 at the end of the name of the association )pon the register and the association shall cease to en.oy the exemptions and pri+ileges granted by this section: 1ro+ided that before a licence is sop cancelled the *o+ernment shall gi+e to the association a notice in writing of its intention and the gro)nds their of and shall afford the association an opport)nity of s)bmitting a representation in opposition to the cancellation. Companies ,imited by 8ua(antee .9. P(o9ision as to companies limited by 4ua(antee.

!9

!" In the case of company limited by g)arantee and not ha+ing a share capital and registered after the commencement of this Act e+ery pro+ision in the memorand)m or articles or in any resol)tion of the company p)rporting to gi+e any person a right to participate in the di+isible profits of the company otherwise than as a member shall be +oid. (" :or the p)rpose of this section and the other pro+isions of this Act. relating to the memorand)m of a company limited by g)arantee e+ery pro+ision in the memorand)m or articles% or in any resol)tion% of any company limited by g)arantee and registered after the commencement of this Act. p)rporting to di+ide the )nderta2ing of thecompany into shares or interests shall be treated as a pro+ision for as share capital notwithstanding that the nominal amo)nt or n)mber of the shares or interests is not specified thereby.

PA T *** S:A + CAP*TA,, +8*ST AT*!N !7 2N,*'*T+/ C!'PAN- AS ,*'*T+/ AN/ 2N,*'*T+/ ,*A;*,*T- !7 /* +CT! S
/ist(ibution of Sha(e Capital

0%. Natu(e of sha(es. !" #he shares or other interests of any member a company shall be deemed to be mo+able property and shall be transferable in manner pro+ided by the articles of the company. (" Each share in a company ha+ing a share capital shall be disting)ished by the appropriate n)mber. 01. Ce(tificate of sha(es o( stoc<. A certificate )nder the common seal of the company specifying any shares or stoc2 held by any member shall be prima facie e+idence of the title of the member to the shares or stoc2 therein specified. 0.. /efinition of 'embe(. !" E+ery s)bscriber of the memorand)m of company shall be deemed to ha+e agreed to become a member of the company and on its registration shall be entered as a member in its register of members. (" E+ery other person who agrees to become a member of a company% and whose name is entered in its register of members shall be a member of the company. 00. 'embe(ship of holdin4 company

!'

!" Except in the cases mentioned in this section a body corporate cannot be a member of a company which is its holding company and any allotment or transfer or shares in a company to its s)bsidiary shall be +oid. (" 4othing in this section shall apply; namely// a" Where the s)bsidiary is the legal representati+e of a deceased member of the holding company; or b" Where the s)bsidiary is concerned as tr)stee )nless the holding company or a s)bsidiary thereof is beneficially interested )nder the tr)st and is not so interested only by way of sec)rity for the p)rposes of a transaction entered into by it in the ordinary co)rse of b)siness which incl)des the lending of money. 9" #his section shall not pre+ent a s)bsidiary from contin)ing to be a member of its holding company if it was a member thereof either at the commencement of this Act or before becoming a s)bsidiary of the holding company; b)t except in the cases referred to in s)b/section ("% the s)bsidiary shall ha+e no right to +ote at meetings of the holding company or of any class of members thereof. '" S)b.ect of s)b/section (" s)b/sections !" and 9" shall apply in relation to a nominee for a body corporate which is a s)bsidiary as if reference in the said s)b/sections !" and 9" to s)ch a body corporate and a s)bsidiary incl)ded reference to a nominee for it. 3" In relation to a holding company which is either a company limited by g)arantee or an )nlimited company the reference in this section to shares shall% whether or not the company has a share capital be constr)ed as incl)ding a reference to the interest of its members as s)ch whate+er be the form of that interest. 04. e4iste( of membe(

!" E+ery company shall 2eep in one on or more boo2s of register of its members% and enter therein the following partic)lars:// i" the name and addresses% and the occ)pations% if any of the members; ii" in the case of a company ha+ing a share capital% a statement of the shares held by each member% disting)ishing each share by its n)mber% and of the amo)nt paid or agreed to be considered as paid on the shares of each member; iii" the date at which each person was entered in the register as a member; i+" the date at which any person ceased to be a member. (" If a company ma2es defa)lt in complying with the re8)irements of this section. It shall be liable to as fine not exceeding one h)ndred ta2a for e+eryday d)ring which the defa)lt contin)es and e+ery officer of the company who 2nowingly and willf)lly a)thorise or permits the defa)lt shall also be liable to a li2e penalty. 0&. *nde3 of membe(s of company !" E+ery company ha+ing more than fifty member shall% )nless the register of members is in s)ch a form as to constit)te in itself an index% 2eep an index of the names of the members of the !3

company and shall within fo)rteen days after the date on which any alteration is made in the register members ma2e any necessary alteration in the index. (" #he index which may be in the form of a card index shall in respect of each member contain a s)fficient indication to enable the acco)nt of that member to be readily fo)nd. 9" If defa)lt is made in complying with the section the company shall be liable to a fine not exceeding fi+e h)ndred ta2a and e+ery officer of the company who is 2nowingly and willf)lly in defa)lt shall be liable to a li2e penalty. 06. Annual list of membe(s and summa(y !" E+ery company ha+ing a share capital shall within eighteen months from its incorporation and thereafter once at least in e+ery year ma2e a list of all persons who on the day of the first or only ordinary general meeting in the year are members of the company% and of all persons who ha+e ceased to be members since the date of the last ret)rn or in the case of the first ret)rn of the incorporation of the company. (" #he following shall be stated in the list namely:// a" the names% addresses% nationality and occ)pation of all past and <present members; b" the n)mber of shares held by each of the existing members at the date of ret)rn specifying the shares transferred since the date of last ret)rn or% in the case of first ret)rn% since the date of incorporation% by persons who are still members and by persons who ha+e ceased to be members respecti+ely and also the dates of registration of s)ch transfer; and c" a s)mmary disting)ishing between shares iss)ed for cash and shares iss)ed as f)lly or partly paid )p otherwise than in cash and specifying the following:/ !" the amo)nt of the share capital of the company% and the n)mber of the shares into which it is di+ided; (" the n)mber of shares ta2en from the commencement of the company )p to the date of the ret)rn; 9" the amo)nt called )p on each share; '" the total amo)nt of calls recei+ed; 3" the total amo)nt of calls )npaid; >" the total amo)nt of the s)ms% if any% paid by way of commission in respect of any share or debent)res% or allowed by way of disco)nt% in respect of any shares or debent)res% since the date of the last ret)rn or so m)ch thereof as has not been written of at the date of the ret)rn. ?" the total n)mber of shares forfeited; A" the total amo)nt of shares or stoc2 for which share warrants are o)tstanding at the date of the last ret)rn;

!>

&" the total amo)nt of share/warrants iss)ed and s)rrendered respecti+ely since the date of the last ret)rn; !B" the latest date on which the general meeting sho)ld ha+e been held and whether it was act)ally so held; !!" the n)mber of shares or amo)nt of stoc2 comprised in each sharewarrant; !(" the names and addresses of the persons who at the date of ter)rn are the directors of the company and of the persons% if any% who at the said date are the managers managing agents or a)ditors of the company% and the changes in the personnel of the directors% managers managing agents since the last ret)rn together with the dates on which the too2 place; and !9" the total amo)nt of debt d)e from the company in respect of all mortgages and charges which are re8)ired to be registered with the Registrar )nder this Act. 9" #he abo+e list and s)mmary shall be contained in a separate part of the register of members% and shall be completed within twenty/one days after the day of the first or only ordinary general meeting in the year; and the company shall% within that period file with the Registrar a copy signed by two directors% incl)ding the managing director% or where there is no managing director% by a director% and manging agent or manager or secretary of the company together with a certificate from s)ch persons that the list and s)mmary state the facts as they stood on the day aforesaid. '" A pri+ate company shall send with the ann)al ret)rn re8)ired by s)bsection !" a certificate signed by a director or other officer of the company that the company has not% since the date of the last ret)rn or in the case of a first ret)rn since the date of the incorporation of the company% iss)ed any in+itation to the p)blic to s)bscribe for any shares or debent)res of the company% and where the ann)al ret)rn discloses the fact that the n)mber of members of the company exceeds fifty% also a certificate so signed that the excess consists wholly of persons who )nder s)b/cla)se ii" of cla)se g" of s)b/section !" of section ( are not be incl)ded in rec2oning the n)mber o fifty. 3" If a company ma2es defa)lt in complying with the re8)irements of this section% it shall be liable to a fine not exceeding two h)ndred ta2a for e+ery day d)ring which the defa)lt contin)es% and e+ery officer of the company who 2nowingly and willf)lly a)thorises or permits the defa)lt shall be liable to the li2e penalty. 0". T(ust not to be ente(ed on (e4iste( 4o notice of any tr)st% expressed% implied or constr)cti+e% shall be entered on the register% or be recei+able by the Registrar. 08. T(ansfe( of sha(es !" An application for the registration of the transfer of shares in a company may be made either by the transferer or the transfere% pro+ided where s)ch application is made by the transferer no registration shall in case of party paid shares be effected )nless the company gi+es moti+e of the application to the transferee and s)b.ect to the pro+isions of s)b/section ?" the company shall% )nless ob.ection is made by the transferee two wee2s from the date of receipt of the notice% enter in its register of members the name of the transferee in the same manner and s)b.ect to the same conditions as if the application for registration was made by the transferee.

!?

(" :or the p)rpose of s)b/section !"% notice to the transferee shall be deemed to ha+e been d)ly gi+en if despatched by prepaid post to the transferee at the address gi+en in the instr)ment of transfer and shall be deemed to a+e been deli+ered in the ordinary co)rse of post. 9" It shall not be lawf)l for the company to register a transfer of share in or debent)res of the company )nless the proper instr)ment of transfer d)ly stamped and exec)ted by the transferor and the transferee has been deli+ered to the company along with script: 1ro+ided that% where it is pro+ed to the satisfaction of the directors of the company that an instr)ment of transfer signed by the transferor and transferee has been lost% the company may% if the directors thin2 fit% on an application in writing made by the transferee and bearing the stamp re8)ired by an instr)ment of transferor register the transfer on s)ch terms as to indemnity as the directors may thin2 fit. '" If a company ref)ses to register the transfer of any shares or debent)res the company% shall% within one month from the date on which the instr)ment of transfer was lodged with the company% send to the transferee and the transferor notice of the ref)sal. 3" If defa)lt is made in complying with s)b/section '" of this section% the company shall be liable to a fine not exceeding one h)ndred ta2a for e+eryday d)ring which the defa)lt contin)es and e+ery director% manager secretary other officer who is 2nowing by a party to the defa)lt shall% be liable to a li2e penalty. >" 4othing in s)b/section 9" shall pre.)dice any power of the company to register as shareholder or debent)re holder any person to whom the right to any shares in or debent)res of the company has been transmitted by operation of law. ?" 4othing in this section shall pre.)dice any power of the company )nder its articles to ref)se to register the transfer of any shares. 09. Ce(tification of t(ansfe(. !" #he certification by a company of any instr)ment of transfer of shares in% or debent)res of% the company% shall be ta2en as a representation by the company to any person acting on the faith of the certification that there ha+e been prod)ced to the company s)ch doc)ments as on the face of them show a prime facie title to the shares or debent)res in the transfer named in the instr)ment of transfer% b)t not as a representation that transferor has complete title to the shares or debent)res. (" Where any person acts on the faith of an erroneo)s certification made by a company negligently% the company shall be )nder the same liability to him as if the certification has been made fra)d)lently. 9" :or the p)rposes of this section/ a" an instr)ment of transfer shall be deemed to ha+e certificated if it bears the words 7certificate lodged0 or words to the li2e effect; b" the certification of an instr)ment of transfer shall be deemed to be made by a company% if/ i" the person iss)ing the certificated instr)ment is a person a)thorise to iss)e s)ch instr)ments of transfer on the company7s behalf; and

!A

ii" the certification is signed by any officer or ser+ant of the company or any other person a)thorised to certificate transfers on the company7s behalf% or if a body corporate has been so a)thorised by any officer or ser+ant of that body corporate; c" a certification shall be deemed to be signed by any person if it p)rports to be a)thenticated by his signat)re% )nless it is shown that the signat)re was placed there neither by himself nor by any person a)thorised to )se the signat)re for the p)rpose of certificating transfers on the company7s behalf. 4%. T(ansfe( by le4al (ep(esentati9e. A transfer of the share or other interest of a decease member of a company made by his legal representati+e shall% altho)gh the legal representati+e is not himself a member% be as +alid% as if he had been a member at the time of the exec)tion of the instr)ment of transfer. 41. *nspection of (e4iste( of membe(s. !" #he register of members commencing from the date of the registration of the company and where section 93 applies also the index of members shall be 2ept at the registered office of the company% and s)ch register and index shall% except when closed )nder the pro+isions of this Act shall d)ring b)siness ho)rs s)b.ect to s)ch reasonable restrictions as the company in general meeting impose% so that not less than two ho)rs in each day be allowed for inspection% be 2ept open to the inspection of any member free of cost and to the inspection of any other person on payment of one h)ndred ta2a or s)ch less s)m as the company may prescribe for each inspection% and any s)ch member or other person may ma2e extract thereform. (" Any member or other person may re8)ire a copy of the register or of any part therof or of the list and s)mmary re8)ired by this Act or any part thereof% on payment of fi+e ta2a for e+ery h)ndred words or fractional part thereof re8)ired to be copied and the company shall ca)se any copy so re8)ired by any person to be sent to that person within a period of ten days commencing on the day next after the day on which the re8)irement is recei+ed by the company. +3planation 5 :or the p)rpose of this s)b/section in rec2oning the ten wor2ing days% the non/wor2ing days and days on which the transfer boo2s of the company remain closed shall be excl)ded. 9" If any inspection re8)ired )nder this section is ref)sed or if any copy re8)ired )nder this section is not sent within the proper period the company and e+ery officer of the company who is in defa)lt shall be liable in respect of each offence to a fine not exceeding one h)ndred ta2a and to a f)rther fine not exceeding one h)ndred ta2a for e+eryday d)ring which the ref)sal or defa)lt contin)es% and the $o)rt may by an order compel an immediate inspection of the register and index or direct that copies re8)ired shall be sent to the persons re8)iring them. 4.. Po$e( to close (e4iste(. A company may on gi+ing se+en day7s pre+io)s notice by ad+ertisement in some newspaper circ)lating in the district in which the registered office of the company is sit)ated close the register of members for any time or times not exceeding in the whole forty/fi+e days in each year b)t bot exceeding thirty days at a time. 40. Po$e( of Cou(t to (ectify (e4iste(

!&

!" If a" the name of any person is witho)t s)fficient ca)se entered in or omitted from the register of members of a company; or b" defa)lt is made or )nnecessary delay ta2es place in entering on the register the fact of any person ha+ing become% or ceased to be% a member% the person aggrie+ed% or any member of the company% or the company% may apply to the $o)rt for rectification of the register. (" #he $o)rt may either ref)se the application% or may order rectification of the register and payment by the company of any damages s)stained by any party aggrie+ed and may also ma2e s)ch order as costs as it may consider proper. 9" ,n any application )nder this section the $o)rt may decide any 8)estion relating to the title of any person who is a party to the application to ha+e his name entered in or omitted from the register whether the 8)estion arises between members or alleged members or between members or alleged members on the one hand and the company on the other hand and generally may decide any 8)estion necessary or expedient to be decided for rectification of the register and may also decide any iss)e in+ol+ing any 8)estion of law. 44. Notice to e4iste(a( fo( (ectification of (e4iste(. In the case of a company re8)ired by this Act to file a list of its members with the Register% the $o)rt when ma2ing an order for rectification of the register shall by its order direct notice of the rectification to be filed with the Registrar within from the date of completion of the order. 4&. e4iste( to be e9idence.

#he register of members shall be primafacie e+idence of any matter by this Act directed a)thorised to be inserted therein. 46. *ssue of sha(e $a((ants to bea(e( !" A company limited by shares if so a)thorised by its articles may with respect to any f)lly paid/ )p shares or to stoc2 iss)e )nder its common seal a warrant stating that the bearer of the warrant is entitled to the shares on stoc2 therein specified and may pro+ide by co)pons or otherwise for the payment of the f)t)re di+idends on the shares or stoc2 incl)ded in the warrant in this Act termed as share/warrant. (" 4othing in this section shall apply to a pri+ate company.

4". +ffect of sha(e$a((ant. A share warrant shall entitle the bearer thereof to the shares or stoc2 therein specified and the shares or stoc2 may be transferred by deli+ery of the warrant.

(B

48.

e4ist(ation of name of bea(e( of sha(e $a((ant.

#he bearer of a sharewarrant shall s)b.ect to the articles of the company% be entitled% on s)rrendering it for cancellation% to ha+e his name entered as a member in the register of members; and the company shall be responsible for any loss inc)rre by any person by reason of the company entering in its register the name of a bearer of a share/ warrant in respect of the share of stoc2 therin specified witho)t the warrant being s)rrendered and cancelled. 49. Position of bea(e( of Sha(e#$a((ant. #he bearer of a share warrant may% if the articles of the company so pro+ide be deemed to be a member of the company within the meaning of this Act either to the f)ll extent or for any p)rpose defined in the articles except that he shall not be 8)alified in respect of the shares or stoc2 specified in the warrant for being a director or manager of the company in cases where s)ch a 8)alification is re8)ired by the articles. &%. +nt(ies in (e4iste( $hen sha(e#$a((ant issued. !" ,n the iss)e of share/warrant% the company shall stri2e o)t of its register of members the name of the member then entered therein as holding the shares or stoc2 specified in the warrant% as if he had ceased to be a member and shall enter in the Register the following partic)lars namely:/ i" the fact of the iss)e of the warrant; ii" a statement of the shares or stoc2 incl)ded in the warrant% disting)ishing each share by its n)mber; and iii" the date of iss)e of the warrant. (" If a company ma2es defa)lt in complying with the re8)irements of this section it shall be liable to a fine not exceeding two h)ndred ta2a for e+ery day d)ring which the defa)lt contin)es and e+ery officer of the company who 2nowingly and willf)lly contin)es or permits the defa)lt shall also be liable to a li2e penalty. &1. Su((ende( of Sha(e $a((ant. @ntil the warrant is s)rrendered% the abo+e partic)lars shall be deemed to be the partic)lars re8)ired by this Act to be entered in the register of members; and on the s)rrender the date of the s)rrender shall be entered as if it were the date at which a person ceased to be a member. &.. Po$e( of company to a((an4e fo( diffe(ent amounts bein4 paid on sha(es A company% if so a)thorised by its articles may do any one or more of the following things% namely// i" ma2e arrangements on the iss)e of shares for a difference between he shareholders in the amo)nts and times of payment of calls on their shares; ii" accept from any member who assents thereto the whole or a part of the amo)nt remaining )npaid on any shares held by him altho)gh no part of that amo)nt has been called )p;

(!

iii" pay di+idend in proportion to the amo)nt paid/)p on each share where a larger amo)nt is paid/)p on some shares than on others. &0. Po$e( of company limited by sha(es to alte( its sha(e capital. !" A company limited by shares if so a)thorised by its articles may alter the conditions of its memorand)m% as follows that is to say it may// a" increase its share capital by the iss)e of new shares of s)ch amo)nt as it thin2s expedient; b" consolidate and di+ide all or any of its share capital into shares of larger amo)nt than its existing shares; c" con+ert all or any of its paid/)p shares into stoc2 and recon+ert that stoc2 into paid/)p shares of any denomination. d" s)b/di+ided ist shares% or any of them% into shares of smaller amo)nt than is fixed by the memorand)m% so that in the s)b/di+ision the proportion between he amo)nt paid and the amo)nt% if any% )npaid on each red)ced share shall be the same as it was in the case of the share from which the red)ced share is deri+ed; e" cancel shares which% at the date of the passing of the resol)tion in that behalf% ha+e not been ta2en or agreed to be ta2en by any person% and diminish the amo)nt of its share capital by the amo)nt of the share so cancelled. (" the powers conferred by this section can only be exercised by the company in its general meeting. 9" A cancellation of shares in p)rs)ance of this section shall not be deemed to be a red)ction of share capital within the meaning of the other pro+isions of the Act. '" #he company shall file with the Registrar notice of the exercise of any power referred to tin cla)se d" or cla)se e" of s)b/section !" within fifteen days from the exercise thereof. &4. Notice to etc. e4ist(a( fo( consolidation of sha(e a capital, con9e(sion of sha(es into stoc<

!" Where a company ha+ing a share capital has consolidated and di+ided its share capital into shares of larger amo)nt than its existing shares or con+erted any of the shares into stoc2 or re/ con+erted stoc2 into shares% it shall within fifteen days of the consolidation and di+ision% con+ersion or re/con+ersion% file notice with the Registrar of the same% specifying the share consolidated and di+ided% or con+erted or the stoc2 re/co+erted. (" If a company ma2es defa)lt in complying with the re8)irements of this section% it shall be liable to a fine not exceeding two h)ndred ta2a for e+eryday d)ring which the defa)lt contin)es% and e+ery officer of the company who 2nowingly and willf)l a)thorises or permits the defa)lt shall also be liable to the li2e penalty. &&. +ffect of con9e(sion of sha(es into stoc<. Where a company ha+ing a share capital has con+erted any of its shares into stoc2 and filed notice of the con+ersion with the Register all the pro+isions of this Act which are applicable to ((

shares only shall cease as to so m)ch of the share capital as is con+erted into stoc2; and the register of members of the company% and the list of members to be filed with the Registrar shall show the amo)nt of stoc2 held by each member instead of the amo)nt of shares and the partic)lars relating to shares hereinbefore re8)ired by this Act. &6. Notice of inc(ease of sha(e capital o( of membe(s. !" Where a company ha+ing a share capital% whether its shares ha+e or ha+e not been con+erted into stoc2% has increased its share capital% beyond the registered capital% and where a company not ha+ing a share capital has increased the n)mber of its members beyond the registered n)mber% it shall file with the Registrar% in the case of an increase of share capital% within fifteen days after the passing of the resol)tion a)thorising the increase and in the case of an increase of members within fifteen days after the increase was resol+ed on or too2 place% notice of the increase of capital or members% and the Registrar shall record the increase. (" #he notice )nder s)b section !" shall incl)de partic)lars of the classes of shares% affected and the conditions% if any% s)b.ect to which the new shares are to be iss)ed. 9" If a company ma2es a defa)lt in complying with the re8)irements of this section% it shall be liable to a fine not exceeding two h)ndred ta2a for e+ery day d)ring which the defa)lt contin)es% and e+ery officer of the company who 2nowingly and willf)lly a)thorises or permits the defa)lt shall be liable to a li2e penalty. &". Application of p(emiums (ecei9ed on issue of sha(es. !" Where a company iss)es shares at a premi)m% whether for cash or otherwise% a s)m e8)al to the aggregate amo)nt or +al)e of the premi)ms on those shares% shall be transferred to an acco)nt% to be called 0the share premi)m acco)nt0 and the pro+isions of this Act relating to the red)ction of the share capital of a company shall% except as pro+ided in this section% apply as if the share premi)m acco)nt were paid/)p share capital of the company. (" #he share premi)m acco)nt may be applied by the company// a" in paying )p )niss)ed shares of the company to be iss)ed to member of the company as f)lly paid bon)s shares; b" in writing of the preliminary expenses of the company% c" in writing off the expenses of% or the commission paid or disco)nt allowed% on any iss)e of shares or debent)res of the company; or d" in pro+iding for the premi)m payable on the redemption of any redeemable preference shares or of any debent)res of the company. 9" Where is company has% before the commincement of this Act iss)ed any shares at a premi)m this section shall apply as if the shares had been iss)ed after the commencement of this Act: 1ro+ided that any part of the premi)m which has been so applied that it does not at the commencement of this Act form an identificable part of the company7s reser+es within the meaning of Sched)le DI shall be disregarded in determining the s)m to be incl)ded in the share premi)m acco)nt. eduction of Sha(e Capital

(9

&8. est(iction on pu(chase by company o( loans by Company fo( pu(chase of its o$n sha(es !" 4o company limited by shares shall ha+e power to b)y its own shares or the shares of a p)blic company of which it is a s)bsidiary company% )nless the conse8)ent red)ction of capital is effected and sanctioned in the manner pro+ided by sections 3& to ?B. (" 4o company limited by shares other than pri+ate company or a s)bsidiary company of a p)blic company% shall gi+e whether directly or indirectly% and whether by means of a loan g)arantee the pro+ision of sec)rity or otherwise any financial assistance for the p)rpose of or in connection with a p)rchase made or to be made by any person of any shares in the company: 1ro+ided that nothing in this section shall% where the lending of money is part of the ordinary b)siness of a company% be ta2en to prohibit the lending of money by the company in the ordinary co)rse of its b)siness. 9" If a company acts in contra+ention of this section% the company% are e+ery officer of the company who is 2nowingly and willf)lly in defa)lt shall be liable to a fine not exceeding fi+e tho)sand ta2a. '" 4othing in this section shall affect the right of a company to redeem any shares iss)ed )nder section !3'. &9. eduction of sha(e capital.

!" S)b.ect to confirmation by the $o)rt% a company limited by shares% if so a)thorised by its articles% may by special resol)tion red)ce its share capital in any way% and in partic)lar the company may% as part of this general power// a" exting)ish or red)ce the liability on any of its shares in respect of share capital not paid/)p; b" either with or witho)t exting)ishing or red)cing liability on any of its shares% cancel any paid/)p share capital which is lost or presented by a+ailable assets; c" either with or witho)t exting)ishing or red)cing liability on any of its shares% pay off any paid/)p share capital which is in excess of the wants of the company; d" so far as is necessary% alter its memorand)m by red)cing the amo)nt of its share capital and of its shares accordingly. (" A special resol)tion )nder this section is in this Act called a resol)tion or red)cing share capital.

6%. Application to Cou(t fo( confi(min4 o(de( Where a company has passed a resol)tion for red)cing share capital it shall apply by petition to the $o)rt for an order confirming the red)ction. 61. Addition to name of company of =and (educed=

('

,n and from the passing by a company of a resol)tion for red)cing share capital% or where the red)ction does not in+ol+e either the dimin)tion of any liability in respect of )n/paid share capital or the payment to any share holder of any paid/)p share capital% then on and from the ma2ing of the order by the $o)rt confirming by the red)ction the company shall add to its name% )ntil s)ch date as the $o)rt may fix% the words 0and red)ced0 as the last words in its name and those words shall )ntil that date be deemed to be part of the name of the company: 1ro+ided that where the red)ction does not in+ol+e either the dimin)tior of any liability in respect of )npaid share capital or the payment to any shareholder of any paid/)p share capital% the $o)rt may% if it thin2s expedient dispense altogether with the addition of words 0and red)ced0. 6.. !b>ections by c(edito(s and settlement of list of ob>ectin4 c(edito(s5 !" Where the proposed red)ction of share capital in+ol+es either dimin)tion of liability in respect of )npaid share capital or the payment to any shareholder of any paid/)p share capital% witho)t permission of the $o)rt and in any other case if the $o)rt so permits e+ery creditor of the company% who at the date fixed by the $o)rt is entitled to any debt or claim which if that date were the commencement of the winding )p of the company wo)ld be admissible in proof against the company shall be entitled to ob.ect to the red)ction. ("#he $o)rt shall settle a list of creditors so entitle to ob.ect% and for that p)rpose shall ascertain as far as possible witho)t re8)iring an application from any creditor the names those creditors and the nat)re and amo)nt of their debts or claims and may iss)e notices fixing a day or days within which creditors not entered on the list are to claim to be so entered on to be excl)ded from the right of ob.ecting to the red)ction; and after consideration s)ch claims the $o)rt shall finalise the list. 60. Po$e( to dispense $ith consent of c(edito( on secu(ity bein4 4i9en fo( his debt Where a creditor entered on the list of creditors whose debt or claim is not discharged or determined does not consent to the red)ction% the $o)rt may% if it thin2s fit dispense with the consent of the creditor on the company sec)ring payment of his debt or claim by appropriating as the $o)rt may direct the following amo)nt that is to say// i" if the company admits the f)ll amo)nt of his debt or claim or tho)gh not admitting it is willing to pro+ide for it then the f)ll amo)nt of the debt or claim; ii" if the company does not admit or is not willing to pro+ide for the f)ll amo)nt of the debt or claim% or if the amo)nt is contingent or not ascertained% then an amo)nt fixed by the $o)rt after the li2e in8)iry and ad.)dication as if the company were being wo)nd )p by the $o)rt. 64. !(de( confi(min4 (eduction #he $o)rt if satisfied with respect to e+ery creditor of the company who )nder this Act is entitled to ob.ect to the red)ction% that either consent tot he red)ction has been obtained or his debt or claim has been discharged or has been determined or has been sec)red may ma2e an order confirming the red)ction on s)ch terms and conditions as it thin2s fit. 6&. e4ist(ation of o(de( minutes of (eduction

!" #he Registrar shall% on prod)ction to him% register the following doc)ments% namely://

(3

a" the certified copy of the order of the $o)rt confirming the red)ction of the share capital of a company. b" a copy of the min)tes appro+ed by the $o)rt% showing the following : i" the amo)nt of the red)ced share capital; ii" the n)mber of shares into which it is to be di+ided; iii" the nominal +al)e of each s)ch share;. i+" the amo)nt% if any% at the date of registration% deemed to be paid )p on each s)ch share. (" ,n the registration )nder s)b/section !" and not before% the resol)tion for red)cing share capital as confirmed by the order so registered shall ta2e effect. 9" 4otice of the registration shall be p)blished in s)ch manner as the $o)rt may direct. '" #he Registrar shall certify )nder his hand the registration of the order and min)tes% and his certificate shall be concl)si+e e+idence that all the re8)irements of this Act with respect to red)ction of share capital ha+e been complied with% and that the share capital of the company is s)ch as is stated in the min)te. 66. 'inutes to fo(m pa(t of memo(andum !" #he min)tes when registered shall be deemed to be s)bstit)ted for the corresponding part of the memorand)m of the company% and shall be +alid and alterable as if it had been originally contained therein% and it shall be embodied in e+ery copy of the memorand)m iss)ed after its registration. (" If a company ma2es defa)lt in complying with the re8)irements of this section% it shall be liable to a fine not exceeding one h)ndred ta2a for each copy in respect of which defa)lt is made% and e+ery officer of the company who 2nowingly and willf)lly a)thorises or permits the defa)lt shall be liable to a li2e penalty. 6". ,iability of membe(s in (espect of (educed sha(es !" member of the company% past or present% shall not be liable in respect of any share to any call or contrib)tion exceeding in amo)nt the difference% if any% between the amo)nt paid% or% as the case may be% the red)ced amo)nt% if any% which is to be deemed to ha+e been paid% on the share and the amo)nt of the share as fixed by the min)tes: 1ro+ided that% if any creditor% entitled in respect of any debt or claim to ob.ect to the red)ction of share capital% is by reasons of his ignorance of the proceedings for red)ction or of their nat)re and effect with respect to his claim% not entered on the list of creditors% and% after the red)ction% the company is )nable% within the meaning of the pro+isions of this Act or with respect to winding )p by the $o)rt% to pay the amo)nt of his debt or claim% then// i" e+ery person who was a member of the company at the date of the registration of the order for red)ction and min)te% shall be liable to contrib)te for the payment of that debt or claim an amo)nt not exceeding the amo)nt which he wo)ld ha+e been liable to contrib)te if the company had commenced to be wo)nd )p on the day before that registration; and (>

ii" if the company is wo)nd )p% the $o)rt on the application of any s)ch creditor and proof of his ignorance as aforesaid% may% if it thin2s fit% settle accordingly a list of persons so liable to contrib)te% and ma2e and enforce calls and orders on the contrib)tors settle on the list as if they were ordinary contrib)tories in a winding )p. (" 4othing in this section shall after the rights of the contrib)tories amo)nt themsel+es. 68. Penalty on concealment of name of c(edito(5 If any officer of the company willf)lly conceals the name of any creditor entitled to ob.ect to the red)ction or willf)lly misrepresents the nat)re or amo)nt of the debt or claim of any creditor% or if any officer of the company abets% any s)ch concealment or misrepresentation as aforesaid e+ery s)ch officer shall ha+e p)nishable with imprisonment which may extend to two years% or with fine% or with both. 69. Publication of (easons fo( (eduction5 In any case of red)ction of share capital% the $o)rt may re8)ire the company to p)blish% as the $o)rt directs% the reasons for red)ction or s)ch other information in regard thereto as the $o)rt may thin2 expedient with a +iew to gi+ing proper information to the p)blic% and% if the $o)rt thin2 fit% also ca)ses which led to the red)ction. "%. *nc(ease and (eduction of sha(e capital of a company limited by 4ua(antee5 A $ompany limited by g)arantee and registered after the commencement of this Act may% if it has a share capital and is so a)thorised by its articles% increase or red)ce its share capital in the same manner and s)b.ect to the same conditions in and s)b.ect to which a company limited by shares may increase or red)ce its share capital )nder the pro+isions of this Act. ?a(iation of Sha(eholde(@s "1. i4hts of holde(s of special classes of sha(es5 i4hts

!" If in the case of a company% the share capital of which is di+ided into different classes of shares% pro+ision is made by the memorand)m or articles a)thorising the +ariation of the rights attached to any class of shares in the company% s)b.ect to the consent of any specified proportion of the holders of the iss)ed shares of that class or the sanction of are sol)tion passed at a separate meeting of the holders of those shares% and in p)rs)ance of the said pro+ision the rights attached to any class of shares are at any time +aried% the holders of the less in the aggregate than ten per cent of the iss)ed shares of that class% being persons who did not consent to or +ote in fa+o)r of the resol)tion for the +ariation% may apply to the $o)rt to ha+e the +ariation cancelled% and where any s)ch application is made% the +ariation shall not ha+e effect )nless and )ntil it is confirmed by the $o)rt. (" An application )nder s)b/section !" m)st be made within fo)rteen days after the date on which the consent was gi+en or the resol)tion was passed% as the case may be% )nder that s)b/ section and may be made on behalf of the shareholders entitled to ma2e the application by s)ch one or more of their n)mbers as they may appoint in writing for the p)rpose. 9" ,n any s)ch application% the $o)rt% after hearing the applicant and any other persons who apply to the $o)rt to be heard and appear to the $o)rt to be interested in the application% may if it is satisfied ha+ing regard to all the circ)mstances of the case that the +ariation wo)ld )nfairly

(?

pre.)dice the shareholders of the class represented by the applicant% disallow the +ariation and shall% if not so satisfied% confirm the +ariation. '" #he decision of he $o)rt on any s)ch application shall be final. 3" #he company shall% within fifteen days after the ser+ice on the company of any order made on any s)ch application% forward a copy of the order to the Registrar% and if defa)lt is made in complying with this pro+ision% the company shall be liable to a fine not exceeding two h)ndred ta2a and e+ery officer of the company who is 2nowingly and willf)lly in defa)lt shall be liable to a li2e penalty. >" #he expression 0+ariation0 in this section incl)des 0abrogation0 and the expression 0+aried0 shall be constr)ed accordingly. e4ist(ation of 2nlimited Company as ,imited ".. e4ist(ation of unlimited company as limited5

!" S)b.ect to the pro+isions of this section% any company registered as )nlimited may register )nder this Act as limited and any company registered before the commencement of this Act as a limited company may re/register )nder this Act% b)t the registration of an )nlimited company as a limited company shall not affect any debts% liabilities% obligations or contracts inc)rred or entered into by% to% with or on behalf of% the company before the registration% and those debts% liabilities% obligations and contracts may be enforced in manner pro+ided by part EIII of this Act in the case of a company registered in p)rs)ance of that 1art. (" ,n registration in p)rs)ance of this section% the Registrar shall close the former registration of the company% and may dispense with the deli+ery to him of companies of any doc)ments with copies of which he was f)rnished on the occasion of the original registration of the company; b)t% sa+e as aforesaid% the registration shall ta2e place in the same manner and shall ha+e effect as if it were the first registration of the company )nder this Act. "0. Po$e( of unlimited company to p(o9ide fo( (ese(9e sha(e capital on (e4ist(ation !" An )nlimited company ha+ing a she capital may% by its resol)tion for registration as a limited company in p)rs)ance of this Act% do either or both of the following things% namely:// a" increase the nominal amo)nt of its share capital by increasing the nominal amo)nt of each of its shares% b)t s)b.ect to the condition that no part of the amo)nt by which its capital is so increased shall be capable of being called )p except in the e+ent and for the p)rpose of the company being wo)nd )p; b" pro+ide that a specified portion of its )ncalled share capital shall not be capable of being called )p except in the e+ent and for the p)rpose of the company being wo)nd )p. (" the portion of the share capital increased or specified )nder s)b/ section !" shall be called the reser+ed share capital. ese(9e Capital of ,imited Company "4. ese(9e Capital of ,imited company5

(A

A limited company may by special resol)tion% determine that any portion of its share capital which has not been already called )p shall not be capable of being called )p% except in the e+ent and for the p)rposes of the company being wo)nd )p% and there)pon that portion of its share capital shall not be capable of being called )p except in the e+ent and for the p)rposes aforesaid; and s)ch portion shall be called reser+ed share capital. 2nlimited ,iability of /i(ecto(s "&. ,imited company may ha9e di(ecto(s $ith unlimited liability !" In a limited company the liability of the directors or of any director may% if so pro+ided by the memorand)m% be )nlimited. (" In a limited company in which the liability of any director is )nlimited% the directors of the company% if any% and the member% who proposes a person for election or appointment to the office of director% shall add to that proposal a statement that the liability of the person holding that office will be )nlimited and the promoter and officers of the company or one of them shall% before the person accepts the office or acts therein% gi+e him notice in writing that his liability will be )nlimited. 9" If any director or proposer ma2es defa)lt in adding a statement as re8)ired by s)b/section !"% or if any promoter or officer of the company ma2es defa)lt in gi+ing a notice as re8)ired by that s)b/ section% the shall be liable to a fine not exceeding fi+e tho)sand ta2a and shall also be liable for any damage which the person so elected or appointed may s)stain from the defa)lt% b)t the liability of the person elected or appointed shall not be affected by the defa)lt. "6. Special (esolution of limited company ma<in4 liability of di(ecto(s unlimited. !" A limited company if so a)thorised by its articles may% by special resol)tion% alter its memorand)m so as to render )nlimited the liability of its directors or of any director. (" @pon the passing of any special resol)tion )nder s)b/section !"% the pro+isions thereof shall be +alid as if they had been originally contained in the memorand)m.

PA T *? 'ANA8+'+NT AN/ A/'*N*ST AT*!N

!ffice and Name

"". e4iste(ed office of company # !" A company shall as from the day on which it begins to carry on b)siness or as from the twenty/eight day after the date of its incorporation% whiche+er is earlier% ha+e a registered office to which all comm)nications and notices may be addressed. (" 4otice of the sit)ation of the registered office and of any change therein shall be gi+en within twenty/eight days after the date of the incorporation of the company or of the change% as the case may be% to the Registrar who shall record the same. 9" #he incl)sion in the ann)al ret)rn of a company of the statement as to the address of its registered office shall not be ta2en to satisfy the obligation imposed by this section.

(&

'" If a company carries on b)siness witho)t complying with the re8)irements of this section% it shall be liable to a fine not exceeding two h)ndred ta2a for e+ery day d)ring which it so carries on b)siness. "8. Publication of name by a limited company # E+ery limited company/ a" Shall paint or affix% and 2eep painted or affixed% in letters easily legible and in 6engali or English characters% its name in a conspic)o)s position on the frontside of e+ery office or place in which its b)siness is carried on: b" shall ha+e its name engra+e in legible characters on its seal; c" shall ha+e its name mentioned in legible 6angali or English characters in all bill/heads% letter papers and in notices% ad+ertisements and other official p)blications of the company% and in all bills of exchange% h)ndis% promissory notes% endorsements% che8)es and orders for money or goods p)rporting to be singed by or on behalf of the company% and in all bills of parcels; in+oices% receipts and letters credit of the company. "9. Penalties fo( non#publication of name # !" If a limited company maines defa)lt in complying with the pro+isions of section ?A a"% it shall be liable to a fine not exceeding fi+e h)ndred ta2a for e+eryday d)ring which the defa)lt contin)es and e+ery officer of the company% who 2nowingly and willf)lly a)thorises or permits the defa)lt% shall be liable to a li2e penalty. (" If any officer of a limited company% or any person on its behalf// a" )ses or a)thorises the )se of any seal p)rporting to be a seal of the company whereon its name is not engra+en as re8)ired by section ?A b"; or b" iss)es or a)thorises the iss)e or any bill/head% letter paper% notice% ad+ertisement or other official p)blication of the company% or signs or a)thorises on be signed on behalf of the company any bill of exchange h)ndi% promissory note% endorsement% che8)e or order for money or goods% or iss)es or a)thorises to be iss)ed any bill of parcels% in+oice% receipt or letter of credit of the company% wherein its name is not mentioned as re8)ired by section ?A b"; he shall be liable to a fine not exceeding one tho)sand ta2a% and shall f)rther be personally liable to the holder of any s)ch bill% h)ndi% promissory note% che8)e or order for the amo)nt thereof% )nless the same is d)ly paid by the company. 8%. Publication of autho(ised as $ell as subsc(ibed and paid#up capital### !" Where any notice% ad+ertisement or other official p)blication of a company contains a statement of the amo)nt of the a)thorised capital of the company% s)ch notice% ad+ertisement or other official p)blication shall also contain a statement in an e8)ally prominent position and in e8)ally conspic)o)s characters of the amo)nt of the capital which has been s)bscribed and the amo)nt paid/)p. (" Any company which ma2es defa)lt in complying with the re8)irements of this section and e+ery officer of the company who is 2nowingly a party to the defa)lt shall liable to a fine not exceeding fi+e tho)sand ta2a. 'eetin4 and P(oceedin4

9B

81. Annual 4ene(al meetin4## !" E+ery company shall in each year of the *rogorian calendar hold in addition to any other meetings a general meeting as its ann)al general meeting and shall specify the meeting as s)ch in the notices calling it; and not more than fifteen months shall elapse between the date of one ann)al general meeting of a company and that of the next: 1ro+ided that a company may hold its first ann)al general meeting within a period of not more than eighteen months from the date of its incorporation; and if s)ch general meeting is held within that period% it shall not be necessary for the company to hold any ann)al general meeting in the year of its incorporation or in the following year; 1ro+ided f)rther that the Registrar may% on an application made by a company within thirty days from the date of expiry of the period specified for holding the ann)al general meeting as aforesaid% extend the time within which any ann)al general meeting% not being the first ann)al general meeting shall be held% by a period not exceeding ninety days or not exceeding the 9!st 5ecember of the calendar year in relation to which the ann)al general meeting is re8)ired to be held% whiche+er is earlier. (" If a company defa)lts in complying with the pro+isions of s)b/section !"% the $o)rt may% on the application of any member of the company% call or direct the calling of a general meeting of the company and gi+e s)ch ancillary or conse8)ential direction as the $o)rt thin2s expedient in relation to the calling holding and cond)cting of the meeting. 8.. Penalty fo( default in complyin4 $ith section 81## If defa)lt is made in holding a meeting of the company in accordance with s)b/ section !" of section A!% or in complying with any directions of the $o)rt )nder s)b/section (" thereof% the company and e+ery officer of the company who is in defa)lt% shall be p)nishable with fine which may extend to ten tho)sand ta2a and in case of a contin)ing defa)lt% with a f)rther fine which may extend to two h)ndred fifty ta2a for e+ery day after the first day d)ring which s)ch defa)lt contin)es. 80. Statuto(y meetin4 and statuto(y (epo(t of company // !" E+ery company limited by shares and e+ery company limited by g)arantee and ha+ing a share capital shall% within a period of not less than one month and not more than six months from the date at which the company is entitled to commence b)siness% hold a general meeting of the members of the company; in this Act s)ch meeting is referred to as 0the stat)ary meeting0. (" #he 6oard of 5irectors shall% in accordance with the other pro+ision of this Act% prepare a report% in this Act referred to as 7stat)tory report0 and shall at least (! days before the day on which the stat)tory meeting is not be held% forward the report to +ery member of the company: 1ro+ided that if the report is forwarded later than the time as is re8)ired abo+e% it shall notwithstanding that fact% be deemed to ha+e been d)ly forwarded if any member entitled to attend and +ote at the meeting does not ob.ect to s)ch forwarding. 9" #he stat)tory reports shall set o)t the following namely// a" the total n)mber of shares allotted% disting)ishing the shares allotted as f)lly or partly paid/)p% otherwise than in cash% and stating in the case of shares partly paid/)p% the extent to which they are so paid )p% and in either case% the consideration for which they ha+e been allotted; b" the total amo)nt of cash recei+ed by the company in respect of all the shares allotted% disting)ished as aforesaid; c" showing )nder separate proper headings//

9!

i" an abstract of receipts of the company and of the payments made thereo)t )p to a date within se+en days prior to the date of the report; ii" the receipts of the company from the shares and debent)res and other so)rces% the payments made thereo)t and partic)lars of the concerning balance remaining in hand; iii" any commission or disco)nt paid or to be paid on the iss)e or sale of shares or debent)res; and i+" an acco)nt or estimate of the preliminary expenses of the company; d" the names% addresses and occ)pations of the directors of the company and of its a)ditors; and also% if there be any% of its managing agent% manager and secretary. and the change% if any which ha+e occ)rred in s)ch names addresses in and occ)pations since the date of the incorporation of the company; e" the partic)lars of any contract which% or the modification or the proposed modification of which is to be s)bmitted to the meeting for its appro+al% together with the partic)lars of the modification or proposed modification of s)ch contract; f" the extent% if any% d)e on calls from e+ery director% from managing agent% e+ery partner of the managing agent% e+ery firm in which the managing agent is a partner% and where the managing agent is a pri+ate company% e+ery director thereof; h" the partic)lars of any commission or bro2erage paid or to be paid in connection with the iss)e or sale of shares or sale of shares or debent)res to any director% or to the managing agent% any partner of the managing agent% any firm in which the managing agent is a partner and% where the managing agent is a pri+ate company% to any director thereof. '" #he stat)tory report shall be certified as correct by not less than two directors of the company% one of whom shall be the managing director where there is one. 3" After the stat)tory report has been certified as re8)ired by s)b/section '"% the 6oard of 5irectors the company shall% in so far as the report relates to the shares allotted by the company% the cash recei+ed in respect of s)ch shares and the receipts and payments of the company% get it certified as correct by the a)ditors of the company. >" #he 6oard of 5irector shall ca)se a copy of the stat)tory report certified as if re8)ired by this section to be deli+ered to the Registrar for registration forthwith% after copies thereof ha+e been sent to the members of the company. ?" #he 6oard of 5irectors shall prepare a list showing the names% addresses and occ)pation of the members of the company% and the n)mber of shares held by them respecti+ely% to be prod)ced at the commencement of the stat)tory meeting and to remain open and accessible to any member of the company d)ring the contin)ance of the meeting. A" #he members of the company present at the meeting shall be at liberty to disc)ss any matter relating to the formation of the company or arising o)t of the stat)tory report% whether pre+io)s notice has been gi+en or not; b)t no resol)tion may be passed of which notice has not been gi+en in accordance with the pro+isions of this Act. &" #he meeting may ad.o)rn from time to time and at any ad.o)rned meeting% any resol)tion of which notice has been gi+en in accordance with the pro+isions of this Act% Whether before or after

9(

the former meeting% may be passed; and the ad.o)rned meeting shall ha+e the same powers as an original meeting. !B" If a petition is presented to the $o)rt in the manner pro+ided by 1art E for winding )p of the company on the gro)nd of defa)lt in filing the stat)tory report or in holding the stat)tory meeting the co)rt may% instead of directing that the company be wo)nd )p% gi+e directions for the presentation of the report or for holding the meeting or ma2e s)ch other order as may be .)st. !!" If defa)lt is made in complying with the pro+isions of this section% e+ery director or other officer of the company who is in defa)lt shall be p)nishable with fine which may extend to fi+e tho)sand ta2a. !(" 4othing in this section shall apply to a pri+ate company. 84. Callin4 of e3t(ao(dina(y 4ene(al meetin4 on (eAuisitions## !" 4otwithstanding anything contained in the articles% the directors of a company which has a share capital% shall on the re8)isition of the holders of not less than one tenth on the iss)ed share capital of the company )pon which all calls or other s)ms then d)e ha+e been paid% forthwith proceed to call an extraordinary general meeting of the company% and in the case of a company not ha+ing a share capital the directors thereof shall call s)ch meeting on the re8)isition of s)ch members as ha+e% on the date of s)bmitting the re8)isition% not less than one tenth of the total +oting power in relation to the iss)es on which the meeting is called. (" #he re8)isition m)st state the ob.ects of the meeting and m)st be signed by the re8)isitioned and deposited at the registered office of the company% and may consist of se+eral doc)ments in li2e form% each signed by one or more re8)isitioned. 9" If the directors do not% within twenty one days from the date of deposit of the re8)isition% proceed d)ly to call a meeting on a day not later than forty/fi+e days from the date of the deposit of the re8)isition% then the re8)isitioned% or a ma.ority of them in +al)e% may themsel+es call the meeting% b)t any meeting so called shall be held before the expiration of three months from the date of the deposit of the re8)isition. '" Any meeting called )nder this section by the re8)isitionnists shall be called in the same manner% as nearly as possible% as that in which meetings are to be called by directors. 3" Any reasonable expenses inc)rred by the re8)isitioned by reason of the fail)re of the directors d)ly to call a meeting shall be repaid to the re8)isitionists by the company% and any s)m so repaid shall be retained by the company% o)t of any s)ms d)e or to become d)e from the company by way of fees or other rem)neration for their ser+ices to s)ch of the directors as were in defa)lt. 8&. P(o9ision as to meetin4 and 9otes### !" #he following pro+isions shall ha+e effect with respect to meeting of a company notwithstanding any pro+isions made in the articles of association of the company in this behalf: a" an ann)al general meeting may be called by fo)rteen days notice in writing% and a meeting other than an ann)al general meeting or a meeting for the passing of a special resol)tion may be called by twenty one day7s notice in writing: 1ro+ided that a meeting may be called by shorter notice than aforesaid% if it is so agreed in writing// i" in the case of an ann)al general meeting% by all the members entitled to attend and +ote thereat; and

99

ii" in the case of any other meeting by the members of the company holding% if the company has a share capital not less than &3 percent of s)ch part of the paid/)p share capital of the company as gi+es a right to +ote at the meeting% or ha+ing if the company has no share capital% not less than &3 percent of the total +oting power exerciseable at the meeting; b" notice of the meeting of a company with the statement of the b)siness to be transacted at the meeting shall be ser+ed on e+ery member in the manner in which notices are re8)ired to be ser+ed by Sched)le !; b)t accidental omission to gi+e notice to% or the non/receipt of notice by% any members shall not in+alidate the proceedings at any meeting; c" fi+e members present in person or by proxy% or the chairman of the meeting% or any member or members holding not less than one/tenth of the iss)ed capital which carries +oting rights shall be entitled to demand a poll: 1ro+ided that in the case of a pri+ate company% if not more than se+en members are personally present% one member% and if more than se+en members are personally present% two members% shall be entitled to demand a poll: d" an instr)ment appointing a proxy% if F the form set o)t i reg)lation >A of Sched)le I% shall not be 8)estioned on the gro)nd that if fails to comply with any special re8)irements specified for s)ch instr)ments by the articles; and e" any shareholder whose name is entered in the register of shareholders of the company shall en.oy the same rights and be s)b.ect to the same liabilities as all other shareholders of the same class. (" #he following pro+isions shall ha+e effect if so far as the articles of the company do not ma2e other pro+ision in this behalf:// a" two or more members holding not less than one/tenth or the total share capital paid/ )p or% if the company has not a share% capital% not less than fi+e percent in n)mber of the members of the company may call a meeting. b" in the case of a pri+ate company whose n)mber of members does not exceed six% two members and if s)ch n)mber exceeds six% three members% and in the case of any other company% fi+e members personally present shall be a 8)or)m; c" any member elected by the members present at a meeting may be chairman thereof. d" in the case of company originally ha+ing a share% capital% e+ery member shall ha+e one +ote in respect of each% share or each h)ndred ta2a of stoc2 held by him% and in any other cases +ery member shall ha+e one +ote; e" on a poll% +otes may be gi+en either personally or by proxy; f" the instr)ment appointing a proxy shall be in writing )nder the hand or the appoint or of his attorney d)ly a)thorised in writing or if the appointer is a corporation or a company% either )nder seal or )nder the hands of an officer or an attorney d)ly a)thorised: 1ro+ided that the appointment of proxy shall not be allowed in case of companies formed )nder section (A and a proxy may or may not be a member of the company. 9" If for any reason it is impracticable to call a meeting of a company in any manner in which meeting of that company may be called or to cond)ct the meeting of the company in manner prescribed by the articles or this Act the $o)rt may either of its own motio or on the application of

9'

any director of the company or of any member of the company who wo)ld be entitled to +ote at the meeting% order a meeting of the company to be called% held and cond)cted in s)ch manner as the $o)rt thin2s fit% and where any s)ch order shall for all p)rposes be deemed to be a meeting of the company d)ly called% held and cond)cted. 86. ep(esentation of companies at meetin4s of othe( companies of $hich they a(e membe(s#/ A company which is a member of another company may% by resol)tion of the directors% a)thorise any of its official or any other person to act as its representati+e at any meeting of that other company% and the person so a)thorised shall be entitled to exercise the same powers on behalf of the company which he represents as if he were an indi+id)al shareholder of that other company. 8". +3t(ao(dina(y and special (esolution## !" A resol)tion shall be a extraordinary resol)tion when it has been passed by a ma.ority of not less than three fo)rths of s)ch members entitled to +ote as are present in person or by proxy% where proxies are allowed% at a general meeting of which notice specifying the intention to propose the resol)tion as an extraordinary resol)tion has been d)ly gi+e. (" A resol)tion shall be a special resol)tion when it has been passed by s)ch a ma.ority as is re8)ired for the passing of an extraordinary resol)tion and at a general meeting of which not less than twenty/one day7s notice specifying the intention to propose the resol)tion as a special resol)tion has been d)ly gi+en; 1ro+ided that% if all the members entitled to attend and +ote at any s)ch meeting so agree% a resol)tion may be proposed and passed as a special resol)tion at a meeting of which less than twenty/one day7s notice has been gi+en. 9" At any meeting at which an extraordinary resol)tion or a special resol)tion is s)bmitted to be passed a declaration of the chairman on a show of hands that the resol)tion is carried shall% )nless a poll is demanded% be concl)si+e e+idence of the fact witho)t proof of the n)mber or proportion of the +otes recorded in fa+o)r of or against the resol)tion. '" At any meeting at which an extraordinary resol)tion or a special resol)tion is s)bmitted to be passed a poll may be demanded. 3" Where a poll is demanded% the poll may in accordance with the articles% be ta2en in s)ch manner as the chairman may direct; and if the chairman so directs it be ta2en at the meeting at which it is demanded. >" Where a poll is demanded in accordance with this section% in comp)ting the ma.ority on the poll% reference shall be had to the n)mber of +otes top which each member is entitled by the articles of the company or )nder this Act. ?" :or the p)rposes of this section% notice of a meeting shall be deemed to be d)ly gi+en and the meeting to be d)ly held when the notice is gi+en and the meeting held in manner prescribed by the articles or )nder this Act. 88. e4ist(ation and copies of special and e3t(ao(dina(y (esolution5## !" A copy of e+ery special and extraordinary resol)tion shall% within fifteen days from the passing thereof% be printed or typewritten and d)ly certified )nder the signat)re of an officer of the company and filed with the Registrar who shall record the same.

93

(" Where articles ha+e been registered% a copy of e+ery special resol)tion for the time being in force shall be embodied in or annexed to e+ery copy of the articles iss)ed after the date of the resol)tion. 9" Where articles ha+e not been registered% a copy of e+ery special resol)tion shall be forwarded in print to any member at his re8)iest on payment of fifty ta2a or s)ch less s)m as the company may direct. '" If a company ma2es defalt in so filing with the registar copy of a special or extraordinary resol)tion it shall be liable to a fine not exceeding one h)ndred ta2a for e+ery day d)ring which the defa)lt contin)es. 3" If a company ma2es defa)lt in embodying in complying with the pro+isions of s)b/section (" or 9" it shall be liable to a fine not exceeding fifty ta2a for each copy in respect of which defa)lt is made. >" E+ery officer of a company% who 2nowingly and wilf)lly a)thorise or permits any defa)lt by the company in complying with the re8)irement its of this section% shall be liable to the li2e penalty as is imposed by this section on the company for that defa)lt. 89. 'inutes of p(oceedin4s of 4ene(al meetin4 and of its di(ecto(s## !" E+ery company shall ca)se min)tes of all proceedings of general meeting and meetings of its directors to be entered in boo2s 2ept for that p)rpose. (" Any s)ch min)te% if p)rporting to be signed by the chairman of the meeting at which the proceedings were had. or by the chairman of the next s)cceeding meeting shall be e+idence of the proceedings. 9" @ntil the contrary is pro+ed// a" A general meeting of the company or a meeting of its directors% in respect of the proceedings of which min)tes ha+e been made% shall be deemed to ha+e been d)ly called and held: and b" the proceedings of s)ch meeting shall be deemed to ha+e been held as described in the min)tes and the appointments of directors or li8)idators at s)ch meeting shall be deemed to be +alid: '" #he boo2s containing the min)tes of proceedings of any general meeting of a company shall be 2ept at the registered office of the company and shall d)ring b)siness ho)rs a s)b.ect to s)ch reasonable restrictions as the company may by its article or in general meeting impose so that no less than two ho)rs in each day be allowed for inspection be open to the inspection of any member witho)t charge. 3" Any member shall at any time after fo)rteen days from the meeting% be entitled to be f)rnished within se+en days after he has made a re8)est in that behalf to the company with a copy of any min)tes referred to in s)bsection '" at a change not exceeding ten ta2a for e+ery h)ndred words. >" If any inspection re8)ired )nder s)b/section '" is ref)sed% on if any copy re8)ired )nder s)b/ section 3"% is not f)rnished within the time specified in s)b/section 3"% the company and e+ery officer of the company who is 2nowingly and wilf)lly in defa)lt or who a)thorises or permits

9>

defa)lt shall be liable in respect of each offence to a fine not exceeding ta2a one h)ndred and to a f)rther fine not exceeding one h)ndred ta2a for e+ery day d)ring which the defa)lt contin)es. ?" In the case of any s)ch ref)sal or defa)lt the Registrar may by order compel an immediate inspection of the boo2s in respect of all proceedings of general meeting or direct that the copies re8)ired shall be sent to the person re8)iring them. /i(ecto(s 9%. /i(ecto(s obli4ato(y # !" E+ery p)blic company and a pri+ate company which is a s)bsidiary of a p)blic company shall ha+e at least three directors. (" E+ery pri+ate company other than a pri+ate company mentioned in s)b/section !" shall ha+e at least two directors; 9" ,nly a nat)ral person may be appointed a director. 91. Appointment of di(ecto(s5 # !" 4otwithstanding anything contained in the articles of a company// a" the s)bscribers of the memorand)m shall be deemed to be the directors of the company )ntil the first director are appointed. b" the directors of the company shall be elected by the members from among their n)mber in general meeting; and c" any cas)al +acancy occ)rring among the directors may be filled in by the other directors b)t the person the appointed shall be a person 8)alified to be elected a director )nder cla)se b" and shall be s)b.ect to retirement at the same time as if he had become a director on the day on which the director in whose place he is appointed was last appointed a director. (" 4otwithstanding anything contained in the articles of a company other than a pri+ate company not less than one third of the whole n)mber of directors shall be persons whose period of office is liable to determination at any time by retirement of directors rotation. 9.. est(ictions on appointment o( ad9e(tisement of di(ecto( # !" A person shall not be capable of being appointed director of a company by the articles and shall not be named as a director or proposed director of a company in any prospect)s iss)ed by or on behalf of the company or in relation to any intended company or in any statement in lie) of prospect)s filed by or on behalf of a company )nless before the registration of the articles or the p)blication of the prospect)s% or the filing of he statement in lie) of prospect)s% as the case may be% he has by himself or by his agent a)thorised in writing / a" signed and filed with the Registrar a consent in writing to act as s)ch director; and b" in the case of companies ha+ing a share capital / i" signed the memorand)m for a n)mber of shares not less than his 8)alification shares; or ii" ta2en from the company and paid or agreed to pay for his 8)alification shares; or

9?

iii" signed and filed with the registrar a contract in writing to ta2e form the company and pay for his 8)alification shares; or i+" made and filed with the Registrar any affida+it to the effect that a n)mbert of shares not less than his 8)alifications share are registered in his name. (" ,n the application for registration of the memorand)m and article% if any% of a company% the applicant shall file with the Registrar a list of the persons who ha+e consented to be directors of the company% and% if this list contains the name of any person who has not so consented% the applicant shall be liable to fine not exceeding two tho)sand ta2a: 1ro+ided that nothing in this section shall apply to the appointment of the chief exec)ti+e% by whate+er name called% of any ins)rance company or a ban2ing company as a director of that company if the article; thereof pro+ides for s)ch appointment. 90. Consent of candidate fo( di(ecto(ship # !" E+ery person% proposed as a candidate for the office of a director shall sign% and file with the company% his consent in writing to act as a director% if appointed. (" A person shall not act as a director of the company )nless he has% within thirty days of his appointment% signed and field with the Registrar his consent in writing to act as s)ch director. 94. /isAualifications of di(ecto(s # !" A person shall not be capable of being appointed director of a company% if / a" he has been fo)nd to be of )nso)nd mind by a competent co)rt and the finding is in force; or b" he is an )ndischarged insol+ent; or c" he has applied to be ad.)dicated as an insol+ent and his application is pending; or d" he has not paid any call in repect of shares of the company held by him% whether alone or .ointly with others% and six months ha+e elapsed from the last day fixed for the payment of the call; or e" he is a minor. (" A company may in its articles pro+ide additional gro)nds for dis8)alification of a director. 9&. Notice of meetin4s5##4otice of e+ery meeting of the 6oard of 5irectors of a company shall be gi+en in writing to e+ery director for the time being in 6angladesh and at his address in 6angladesh. 96. 'eetin4 of ;oa(d5##In the case of e+ery company a meeting of its 6oard of 5irectors shall be held at least once in e+ery three and at least fo)r s)ch meetings shall be held in e+ery year. 9". Bualification of /i(ecto(5## !" Witho)t pre.)dice tot he restrictions imposed by section &(% it shall be the d)ty of e+ery director to hold 8)alification share to be specified in the articles and% if he is not already 8)alified% he shall obtain his 8)alification within sixty days after his appointment% or s)ch shorter time as may be fixed by the articles.

9A

(" If% after the expiration of the period mentioned in s)b/section !" any )n8)alified person acts as a director of the company% he shall be liable to a fine not exceeding two h)ndred ta2a for e+ery day between the expiration of the said period and the last day on which it is pro+ed that he acted as a director both days incl)si+e". 98. ?alidity of act of di(ecto(5## #he acts of a director shall be +alid notwithstanding any defect that may afterwards be disco+ered in his appointment of 8)alification: 1ro+ided that nothing in this section shall be deemed to gi+e +alidity to act done by a director after the appointments of s)ch director has been shown to be in+alid. 99. *neli4ibility of b(an<(upt to act as di(ecto(5## !" If any person being an )ndischarged insol+ent acts as director or managing agent or manager of any company% he shall be liable to imprisonment for a term not exceeding two years or to a fine not exceeding fi+e tho)sand ta2a or to both. (" In this section the expression 0company0 incl)des a company incorportated o)tside 6angladesh which has an established place of b)siness within 6angladesh. 1%%. P(obitition on assi4nment of office by di(ecto(5## Any assignment of his office made after the commencement of this Act by any director shall +oid and shall be of no effect. 1%1. Appointment and te(ms and office of alte(nate di(ecto(s## !" #he 6oard of 5irectors of a company may% if so a)thorised by its articles or by a resol)tion passed by the company in general meeting% appoint an alternate director% to act for a director hereinafter in this section called the original director d)ring his absence for a contin)o)s period of not less than three months from 6angladesh. (" An alternate director appointed )nder s)b/section !" shall not hold office as s)ch for a period longer than that permissible to the original director in whose place he has been appointed and shall +acate the office% immediately after he recei+es information that the original director has ret)rned to 6angladesh. 9" If the term of office of the original director is determined before he so ret)rns to 6angladesh any pro+ision for a)tomatic reappointment of retiring directors in defa)lt of another appointment shall apply to the original and not to the alternate director. 1%.. A9oidance of p(o9isions (elie9in4 liability of di(ecto(s5## Sa+e as pro+ided in this section% any pro+ision% whether contained in the articles of a company or in any contract with a company or otherwise% hereafter in this section referred to as the said pro+ision% for exempting any director% manager or officer of the company or any person% whether an officer of the company or not% employed by the company as a)ditor from% or for indemnifying him against% any liability which by +irt)e of any r)le of law wo)ld otherwise attach to him in respect of any negligence% defa)lt% breach of d)ty or breach of tr)st of which he may be g)ilty in relation to the company shall be +oid; 1ro+ided that// a" nothing in this section shall operate to depri+e any person of any exemption or right to be indemnified in respect of anything done or omitted to be done by him while the said pro+ision was in force before the commencement of this Act; and

9&

b" a company may% in p)rs)ance of the said pro+ision indemnify any s)ch director% manager% officer or a)ditor against any liability inc)rred by him in defending any proceedings% whether ci+il or criminal% in which .)dgement is gi+en in his fa+o)r or in which he is ac8)itted or in connection with any application )nder section 9 of this Act in which relief is granted to him by the $o)rt. 1%0. ,oan of /i(ecto(## !" 4o company% hereinafter in this section referred top as the lending company% shall ma2e any loan or gi+e any g)arantee or pro+ide any sec)rity in connection with a loan made by a third party to// a" any director of the lending company b" any firm in which any director of the lending company is a partner; c" any pri+ate company of which any director of the lending company is a director or member; or d" any p)blic company% the managing agent manager or director where of is acc)stomed to act in accordance with the directions or instr)ction of any director of the lending company: 1ro+ided that nothing in this section shall apply to the ma2ing of a loan or gi+ing of any g)arantee or pro+iding any sec)rity by a lending company. if// i" s)ch company is a ban2ing company or a pri+ate company not being a s)bsidiary of a p)blic company% or if s)ch company as a holding company ma2es the loan or gi+es the g)arantee or pro+ide the sec)rity to its s)bsidiary; and ii" the loan is sanctioned by the 6oard of 5irectors of any company and appro+ed by the general meeting and% in the balance sheet% there is a specific mention of the loan% g)arantee or sec)rity% as the case may be: 1ro+ided f)rther that% in no case the total amo)nt of the loan shall exceed 3BG of the paid )p +al)e of the shares held by s)ch director in his own name (" In the e+ent of any contra+ention of s)b/section !" e+ery person who is a party to s)ch contra+ention incl)ding in partic)lar any person to whom a loan is made or on whose behalf a g)arantee is gi+en to or sec)rity pro+ided shall be p)nishable with the fine which extend to fi+e tho)sand ta2a or simple imprisonment for six months in lie) of fine and shall be liable .ointly and se+erally to the lending company for the repayment of s)ch loan or for ma2ing good any s)m which the lending company may be called )p to pay )nder the g)arantee gi+en or sec)rity pro+ided by the lending company. 9" this section shall apply to any transaction represented by a boo2 debt which was from its inception in the nat)re of a loan or an ad+ance. 1%4. /i(ecto( not to hold office of p(ofit## 4o director or firm of which s)ch director is a partner of pri+ate company of which s)ch director is a 5irector shall% witho)t the consent of the company in general meeting% hold any office of profit )nder the company except that of a managing director or manager or a legal or technical ad+iser or a ban2er. +3planation5##:or the p)rpose of this section% the office of managing agent shall not be deemed to be an office of profit )nder the company.

'B

1%&. Sanction of /i(ecto(s necessa(y fo( ce(tain cont(acts## Except with the consent of the directors% a director of the company% or the firm of which he is a partner or any partner of s)ch firm or the pri+ate company of which he is a member or director% shall not erter into any contract for the sale% p)rchase or s)pply of goods and materials with the company. 1%6. emo9al of di(ecto(s## !" #he company may be extraordinary resol)tion remo+e any share/holder director before the expiration of his period of office and may by ordinary resol)tion appoint another person in his stead and the person so appointed shall be s)b.ect to retirement at the same time as if he had become a director on the day on which the director in whose place he is appointed was last elected director. (" A director so remo+ed shall not be re/appointed a director by the 6oard of 5irectors. 1%". est(ictions on po$e( of di(ecto(s###he directors of a company or of a s)bsidiary company of a p)blic company shall not% except with the consent of the company concerned in general meeting// a" sell or dispose of the )nderta2ing of the company; and b" remit any debt d)e by a director. 1%8. ?acation of office of di(ecto(## !" #he office of a director shall be +acant% if// a" he fails to obtain within the time specified in section &? !" or at any time thereafter ceases to hold% the 8)alifications//hares% if any% necessary for his appointment; or b" he is fo)nd to be of )nso)nd mind by a competent co)rt; or c" he is ad.)dged an insol+ent; or d" he fails to pay calls made on him in respect of shares held by him within six months from the date of s)ch calls being made; or e"he or any firm of which he is a partner or any pri+ate company of which he is a director% witho)t the sanction of the company in general meeting accepts or holds any office of profit )nder the company other than that of a managing director or manager or a legal or technical ad+iser or a ban2er; or f" he absents himself from three consec)ti+e meeting of the directors or from all meetings of the directors for a contin)o)s period of three months% whiche+er is the longer% witho)t lea+e of absent from the 6oard of 5irectors; or g" he or any firm of which he is a partner or any pri+ate company of which he is a director accepts a loan or g)arantee from the company in contra+ention of section !B9; or h" he acts in contra+ention of section !B3. (" A company may pro+ide by its articles that the office of director shall be +acated on gro)nds additional to those specified in s)b/section !".

'!

1%9. est(iction on 'ana4in4 /i(ecto(### !" 4o p)blic company and no pri+ate company which is a s)bsidiary of p)blic company shall% after the commencement of this Act% appoint any person as managing director% if he is a managing director or manager of an other company. 1ro+ided the no appointment )nder this section shall be made witho)t the consent of the company in a general meeting. (" 4otwithstanding anything contained in s)b/section !" the go+ernment may% by order% permit any person to be appointed as a managing director of more than two companies if the go+ernment is satisfied that it is necessary that the companies sho)ld% for their proper wor2ing% f)nction as a single )nit and ha+e a common managing director. 11%. 'ana4in4 di(ecto( not to be appointed fo( mo(e than fi9e yea(s at a time.## !" 4o company shall% after the commencement of this Act% appoint or employ any indi+id)al as its managing director for a term exceeding fi+e years at a time. (" Any indi+id)al holding% at the commencement of this Act% the office of the managing director in a company shall% )nless his term expires earlier% be deemed to ha+e +acated his office immediately on the expiry of fi+e years from the commencement of this Act. 9" 4othing contained in s)b/section !" shall be deemed to prohibit the re/employment or the extension of the term of office of any person as managing director for a f)rther period not exceeding fi+e years on each occasion. 1ro+ided that no s)ch re/appointment% re/employment or extension of term of office shall be made witho)t the consent of the company in general meeting. Compensation fo( ,oss of !ffice 111. Compensation fo( loss of office not pe(missible to mana4in4 o( $hole time di(ecto(s o( di(ecto(s $ho a(e mana4e(s.## !" 1ayment may be made by a company% except in the cases specified in s)b/section 9" and s)b.ect to the limit specified in s)b/section '"% to a managing director% or a director holding the office of manager or in the whole time employment of the company% by way of compensation for loss of office or as consideration for retirement from office% or in connection with s)ch loss or retirement. (" 4o payment mentioned in s)b/section !" shall be made by the company to any other director. 9" 4o payment shall be made to a managing or other director in p)rs)ance of s)b/section !" in the following cases namely:// a" where the director resigns his office in +iew of the reconstr)ction of the company% or of its amalgamation with any other body corporate or bodies corporate% and is appointed as the managing director% managing agent% manager or other officer of the reconstr)cted company or of the body corporate res)lting from the amalgamation; b" where the director regigns his office otherwise than on the reconstr)ction of the company or its amalgamation as aforesaid. c" where the office of the director is +acated by +irt)e of any pro+ision of this;

'(

d" where the company is being wo)nd )p% whether by or s)b.ect to the s)per+ision of the $o)rt or +ol)ntarily.% 1ro+ided the winding )p was d)e to the negligence or defa)lt of the director; e" where the director has been g)ilty of fra)d or breach of tr)st in relation to% or of gross negligence in% or gross mismanagement of% the cond)ct of the affairs of the company or any s)bsidiary or holding company thereof; f" where the director has instigated% or has ta2en part directly or indirectly in bringing abo)t% the termination of his office. '" Any payment made to a managing or other director in p)rs)ance of s)b/section !" shall not exceed the rem)neration which he wo)ld ha+e earned if he had been in office for the )nexpired resid)e of his term or for three years% whiche+er is shorter% and s)ch rem)neration shall be calc)late on the basis of// a" the a+erage rem)neration recei+ed by him d)ring the period of three years immediately preceding the date on which he acased to holdthat office; and b" where he held that office for a period of less than three years% the o+erage rem)neration recei+ed by him d)ring the period for which he held the office: 1ro+ided that no s)ch payment shall be made to the director in the e+ent of the commencement of the winding )p of the company% whether before% or at any time within twel+e months after% the date on which he ce)sed to hold office% if the assets of the company on the winding )p after ded)cting the expenses thereof% are not s)fficient to repay to the share holders the share capital incl)ding the premi)ms% if any% contrib)ted by them. 3" 4othing in this section shall be deemed to prohibit the payment to a managing director% or a director holding the office of manager% of any rem)neration for ser+ice rendered by him to the company in any other capacity. 11.. Payment to di(ecto(, etc. fo( loss of office, etc. in connection $ith t(ansfe( of unde(ta<in4 o( p(ope(ty.## !" 4o 5irector of a company shall% in connection with the transfer of the whole or any part of any )nderta2ing or property of the company% recei+e any payment% by way of compensation for loss of office% or as consideration for retirement from office% or in connection with s)ch loss or retirement from the transferee of s)ch )nderta2ing or property or from any other person% )nless partic)lars with respect to the payment proposed to be made by s)ch transferee or person% incl)ding the amo)nt thereof% ha+e been disclosed to the members of the company and the proposal has been appro+e by the company in general meeting. ("Where a director of a company recei+es payment of any amo)nt in contra+ention of s)b/ section !"% the amo)nt shall be deemed to ha+e been recei+ed by him in tr)st for the company. 9" S)b/sections !" and (" shall not affect in any manner the operation of section !!!. 110. Payment to di(ecto( fo( loss of office etc. in connection $ith t(ansfe( of sha(es.## !" Where in connection with the transfer to any persons of all or any of the shares in a company% being a transfer res)lting from// i" an offer made to the general body of shareholders: ii" an offer by or on behalf of some other body corporate with a +iew to the company becoming a s)bsidiary of s)ch body corporate or a s)bsidiary of its holding company;

'9

iii" an offer made by or on behalf of an indi+id)al with a +iew to his obtaining the right to exercise% or control the exercise% of not less than one/third of the total +oting power at any general meeting of the company; or i+" any other offer which is conditional on acceptance to a gi+en extent; and as a res)lt of s)ch transfer a director of the company losses his office or retires therefrom he shall not recei+e any payment by way of compensation for loss of office% or as consideration for retirement from office or in connection with s)ch loss of retirement from the company of the transferee or from any other person. 1ro+ided that on f)lfilment of the re8)irements of the other pro+isions of this section% s)ch director may recei+e s)ch payment from the said transferee or other person. (" In the case referred to the pro+iso to s)b/section !" it shall be the d)ty of the director concerned to ta2e all reasonable steps to sec)re that partic)lars with respect tot he payment proposed to be made by the transferee or other person incl)ding the amo)nt thereof are incl)ded in or sent with the notice re8)ired to sent )nder section !!( (" to shareholders. 9" If / a" any s)ch director fails to ta2e reasonable step in p)rs)ance of s)b section ("; or b" any person who has been properly re8)ired by any s)ch director to incl)de the partic)lars referred to in s)b/section ("% in s)ch notice or to send them with s)ch notice. he shall be p)nishable with fine which may extend to fi+e h)ndred ta2a. '" :or the p)rpose of appro+ing any payment referred to in the pro+iso to s)b/section !"% the company shall call a meeting of the shareholders who were s)ch holders on the date of the offer referred to that s)b/section and also of the holders of the shares of the same class% in this meeting the person ma2ing the said offer or his nominee% and if the offerer is a company the nominee of s)ch company or of any of its s)bsidiary shall not be called; and if the payment is appro+ed in the meeting the director shall be entitled to recei+e it. 3" If% at a meeting called for the p)rpose of appro+ing any payment as re8)ired by s)b/section '"% a 8)or)m is not present and% after the meeting has been ad.o)rned to a later date% a 8)or)m is again not present% the payment shall% for the p)rpose of that s)b/section% be deemed to ha+e been appro+ed. >" If / a" the concerned director fails to comply with the re8)irements of s)bsection ("; or b" the said director recei+es the payment referred to in the pro+iso to s)b/section !". before it is appro+ed )nder s)b/section '". the payment shall be deemed to ha+e been recei+ed by him in tr)st for any persons who ha+e sold their shares as a res)lt of the aforesaid offer% and the expenses inc)rred by him in distrib)ting that s)m amongst those persons shall be borne by him. 114. P(o9isions supplementa(y to section 111, 11. and 110.## !" Where in proceedings for the reco+ery of any payment as ha+ing% by +irt)e of s)b/section (" of section !!( or s)b/section '" of section !!9 been recei+ed by any person in tr)st% it is pro+ed that//

''

a" the payment was made in p)rs)ance of any arrangement entered into as part of the agreement for the transfer in 8)estion. or within one year before% or within two years after% that agreement or the offer leading thereto; and b" the company or any person to whom the transfer was made pri+y to that arrangement. #he payment shall be deemed% except on so far as the contrary is shown% to be on one to which that pro+ision applies. (" If% in connection with any s)ch transfer as is mentioned in section !!( or in section !!9// a" the price to be paid to a director of the company whose office is to be abolished or who is to retire from office% for any shares in the company held by him is in excess of the price which co)ld% at the time% ha+e been obtained by other holders of the li2e shares; or b" any +al)able consideration is gi+en to any s)ch director. the excess or the money +al)e of the consideration% as the case may be shall% for the p)rposes of that section% be deemed to ha+e been a payment. made to him by way of compensation for loss of office% or as consideration for retirement from office% or in connection with s)ch loss or retirement. 9" References in sections !!!% !!( and !!9 to payments made to any director of a company by way of compensation for loss of office% or as consideration for retirement from office% or in connection with s)ch loss or retirement do not incl)de any bonafide payment by way of damages for breach of contract or by way of pension in respect of past ser+ices% and for the p)rposes of this s)b/section% the expression 0pension0 incl)des any s)perann)ation allowance% s)perann)ation grat)ity or similar payment. '" 4othing in section !!( and !!9 shall be ta2en to pre.)dice the operation of any r)le of law re8)iring disclos)re to be made with respect to any s)ch payments as are therein mentioned or with respect to any other li2e payments made or to be made to the directors of a company. 11&. e4iste( of di(ecto(s, mana4e(s and mana4in4 a4ents## !" E+ery company shall 2eep at its registered office a register of its directors% manager and managing agents containing with respect to each of them the following partic)lars% that is to say// a" in the case of an indi+id)al% his present name in f)ll% any former name or s)rname in f)ll% his )s)al residential address% his nationality and% if that nationality is not the nationality of origin% his nationality of origin and his b)siness% occ)pation% if any% and if he holds any other directorship or directorships the partic)lars of s)ch directorship or directorships; b" in the case of a body corporate its corporate name and registered or principal office% and the f)ll name address and nationality of each of its directors; and c" in the case of a firm% the f)ll name% address and nationality of each partner% and the date on which each became a partner. (" #he company shall within the periods specified below send to the Registrar a ret)rn in the prescribed form containing the partic)lars specified in the said register and a notification in the prescribed form of any change among its directors% managers or managing agents or in any of the partic)lars contained in the register// a" in the case of the partic)lars specified in s)b/section !"% within a period of fo)rteen days from the appointment of the first directors of the company;

'3

b" in the case of any change in s)ch partic)lars% within a period of fo)rteen days from the day change ta2es place. 9" #he register to be 2ept )nder this section shall% d)ring b)siness ho)rs and s)b.ect to s)ch reasonable restriction% as the company may by its articles or in general meeting impose so that not less than two ho)rs in each day be allowed for inspection% be open to the inspection of any member of the company witho)t charge and of any person on payment of ten ta2a or s)ch less s)m as the company may impose for each inspection. '" If any inspection re8)ired )nder this section is ref)sed or if defa)lt is made in complying with s)b/section !" or (" of this section% the company and e+ery officer of the company who is 2nowingly and wilf)lly in defa)lt shall be liable to a fine of fi+e h)ndred ta2a. 3" In the case of any s)ch ref)sal% the $o)rt% on application made by the person to whom inspection has been ref)sed and )pon notice to the company% may% by order% direct an immediate inspection of the register. 'ANA8*N8 A8+NT 116. /u(ation of appointment of mana4in4 a4ent.## !" 4o managing agent shall% after% the commencement of this Act% be appointed to hold office for a term of more than ten years at a time and no managing agent shall hold office for more than twenty years. (". 4otwithstanding anything to the contrary contained in the articles of a company or in any agreement with the company% a managing agent of a company appointed before the commencement of this Act shall not contin)e to hold office after the expiry of ten years from s)ch commencement )nless than reappointed thereto. 9" A managing agent whose office is terminated by +irt)e of the pro+isions of s)b/section (" shall% )pon s)ch termination% be entitled to a charge )pon the assets of the company by way of indemnity for all liabilities or obligations property inc)rred by the managing agent on behalf of the company s)b.ect to existing charges and enc)mbrances% if any. '" #he termination of the office of a managing agent by +irt)e of the pro+isions of s)b/section (" shall not ta2e effect )ntil all moneys payable to the managing agent for loans made to or rem)neration d)e )p to date of s)ch termination from company are paid. 3" 4othing in this section shall apply to a pri+ate company which is not the s)bsidiary company of a p)blic company. 11". Conditions applicable to mana4in4 a4ents.##4otwithstanding anything to the contrary contained in the articles of the company or in any agreement with the company. a" a company may% by resol)tion passed at a general meeting of which notice has been gi+en to the managing agent in the same managers as to members of the company% remo+e a managing agent if he is con+icted of an offence in relation to the affairs of the company and the offence is non/bailable within the meaning of the pro+isions of the code of $riminal 1roced)re% !A&A Act E of !A&A": 1ro+ided that where the managing agent is a firm or company and offence committed by a member of s)ch firm or a director or an officer holding a general power of attorney from s)ch company shall be deemed to be an offence committed by s)ch firm or company:

'>

1ro+ided f)rther that a managing agent shall not be liable to be remo+ed )nder the pro+isions thereof if the offending member% director or officer as aforesaid is expelled or dismissed by the managing agent within thirty days from the date of his con+iction or if his con+iction is set aside% on appea; b" the office of a Hanaging agent shall be deemed to be +acant if he is ad.)dged insol+ent; c" a transfer of his office by a managing agent is a firm% a change in the partners thereof shall not be deemed to operate as a transfer of the office of managing agent% so long as one of the original partners shall contin)e to be a partner of the managing agent7s firm; d" a charge or assignment of his rem)neration of any part thereof effected by a managing agent shall be +oid as against the company: e" if a company is wo)nded )p either by the $o)rt or +ol)ntarily% any contract of management made with a managing agent shall be there)pon determined witho)t pre.)dice% howe+er% to the right of the managing agent to reco+er any moneys reco+erable by the managing agent from the company: 1ro+ided that where the $o)rt finds that the winding )p is d)e to the negligence or defa)lt of the managing agent himself% the managing agent shall not be entitled to recei+e any compensation for the premat)re termination of his contract of management; and f" the appointment of a managing agent% the remo+al of managing agent and +ariation of a managing agent7s contract of management shall not be +alied )nless appro+ed by the company by a resol)tion at a general meeting of the company notwithstanding anything to the contrary in section !B': 1ro+ided that nothing contained shall apply to the appointment of a company7s firs agent made prior to the iss)e of the prospect)s or statement in lie) of prospect)s where the terms of the appointment of s)ch managing agent are set forth therein. 118. *n9esti4ation of mana4in4 a4ents, etc.## !" If the *o+ernment has reason to belie+e that the managing agent of a p)blic company// a" has% in connection with the cond)ct or management of the affairs of the company% been g)ilty of fra)d% misfeasance or breach of tr)st: or b" has been cond)ction the affairs of the company for a fra)d)lent or )nlawf)l p)rpose; or c" has so cond)cted or managed the affairs of the company as to depri+e the shareholders thereof of a reasonable ret)rn on their in+estment; the *o+ernment may% after gi+ing the managing agent an opport)nity of being heard% appoint and in+estigator to en8)ire into the affairs of the company and to report on the cond)ct of the managing agent in s)ch manner and within s)ch period as the *o+ernment may direct. +3planation.##/#he shareholders of a company shall be deemed to ha+e been depri+ed of a reasonable ret)rn on their in+estment if% ha+ing regard to enterprises similarly placed for a contin)o)s period of three years. (" #he in+estigator appointed )nder s)b/section !"//

'?

a" may% at any time% for the p)rpose of ma2ing any en8)iry which he considers necessary% enter the premises of the company or the office of the managing agent and may call for and inspect the boo2s of acco)nts or doc)ments in the possession of the company or managing agent and may seal or ta2e into c)stody any boo2s of acco)nts or doc)ments for so long as may be necessary; b" shall ha+e the same powers as are +ested in a $o)rt when trying a s)it )nder the $ode of $i+il 1roced)re% !&BA Act E of !&BA"% in respect of the following matters% namely:// i" s)mmoning and enforcing the attendance of any director or officer of the company or of the managing agent and examining him on oath or affirmation; ii" compelling the prod)ction of any boo2s of acco)nts or doc)ments; and iii" iss)ing commissions for the examination of witnesses; 9" Any proceeding before the in+estigator shall be deemed to be a .)dicial proceeding within the meaning of sections !&9 and ((A or the 1enal $ode Act DCE of !A>B". '" If the *o+ernment after considering the report s)bmitted )nder s)bsection !"% is of opinion that it is necessary to do so in the interest of the efficient management of the affairs of the company% the *o+ernment may% witho)t pre.)dice to any other action that may be ta2en )nder this Act or any other law% by order in writing// a" modify the terms of the managing agent7s agreement of management with the company. b" re8)ire the managing agent to carry o)t s)ch changes in the management or acco)nting proced)res% within s)ch time% as may be specified in the order; or c" remo+e from office the managing agent or the director of the company nominated by the managing agent% or both the managing agent or the director so nominated: 1ro+ided that before ta2ing any action )nder this s)b/section% the managing agent shall be gi+en an opport)nity of presenting his case as to the proposed action. 3" A managing agent or director remo+ed from office )nder s)b/section '"% shall not be entitled to or be paid any compensation or damages for loss or termination of office. >" A managing agent of a company who is remo+ed from office )nder s)b/section '" shall not be appointed to s)ch office of that company )ntil after the expiration of a period of fi+e years from the date of s)ch remo+al. ?" Where the managing agent remo+ed from office )nder s)b/section '" is firm or a company% no partner of s)ch firm and no director or officer holding a general power of attorney from s)ch company shall hold the office of a director or any other office connected with the cond)ct or management or the affairs of the company of which it was managing agent% )ntil after the expiration of a period of fi+e years from the date of s)ch remo+al. A" Where the managing agent of a company is remo+ed from office )nder s)b/section '"% the *o+ernment may by order in writing% appoint an Administrator% hereinafter referred to as the Administrator% to manage the affairs of the company s)b.ect to s)ch terms and conditions as many be specified in the order.

'A

&" #he Administrator shall recei+e s)ch rem)neration as the *o+ernment may determine. !B" #he management of the affairs of the company shall% on and from the date of appointment of the Administrator% +est in him. !!" Where it appears to the Administrator that any p)rchase% sales or agency contract has been centered into% or any employment gi+en to benefit the managing agent or his nominees and to the detriment of the interest of general shareholders% the Administrator may% with the pre+io)s appro+al writing of the *o+ernment% terminate s)ch contract or employment. !(" 4o person shall be entitled to or be paid any compensation or damages for the termination of any contract or employment )nder s)b/section !!". !9" If at any time it appears to the *o+ernment that the p)rpose of the order appointing the Administrator has been f)lfilled% it may permit the company to appoint another person to the office of managing agent% and on the appointment of new managing agent% the Administrator shall cease to hold office. !'" Sa+e as pro+ided in s)b/section !3"% no s)it% prosec)tion or other legal proceeding shall lie against the Administrator personally for anything which is in good faith done or intended to be done by him in p)rs)ance of this section or of any r)les made there)nder% and anything so done shall be deemed to ha+e been done by the company. !3" Any person aggrie+ed by any order of the *o+ernment )nder s)b/section '" or of the Administrator )nder s)b/section !!" may% within sixty days from the date of the order% appeal against s)ch order to the High $o)rt 5i+ision. !>" If any person fails% witho)t reasonable ca)se% to f)rnish any boo2s of acco)nts or doc)ments called for )nder cla)se a" of s)b/section (" or to comply with any order )nder cla)se a" of cla)se b" s)b/section '" or contra+enes the pro+isions of s)b/section >" or s)b/section ?" the *o+ernment may% by order in writing% direct that s)ch person shall pay by way of penalty a s)m which may extend to ten tho)sand ta2a% and in the case of contin)ing fail)re or contraception% a f)rther s)m which may extend to one tho)sand ta2a for e+ery day after the first day d)ring which the fail)re or contraception contin)es. !?" #he *o+ernment may% by notification in the official *a-ette% direct that any power conferred )pon it by this section shall% s)b.ect to s)ch conditions% if any% as may be specified in the direction% be exercisable also by s)ch person or a)thority as may be so specified. !A" #he *o+ernment may% by notification in the official *a-ette% ma2e r)les to carry o)t the p)rpose of this section. !&" #he pro+isions of this section shall ha+e effect notwithstanding anything contained in any other pro+ision of this Act or any other law% contract% or the memorand)m or articles of a company. 119. emune(ation of mana4in4 a4ent.## !" Where a company appoints a managing agent% it shall% in the doc)ments of appointment specify the following/// a" the rem)neration of the managing agent which shall be a s)m based on fixed percentage of the net ann)al profits of the company; and

'&

b" a minim)m payment% in the case of absence or inade8)acy of profits% together with office allowance. (" Any stip)lation for rem)neration additional to% or in any form other than% the rem)neration specified in s)b/section !" shall not be binding on the company )nless sanctioned by a special resol)tion of the company. 9" :or the p)rpose of this section net profits7 means the profits of the company calc)lated after allowing for all the )s)al wor2ing charges% interest on loans and ad+ances% repairs and o)tgoing% depreciation% bo)nties% depreciation% bo)nties or s)bsidies recei+ed from *o+ernment or from a p)blic stat)tory body profits by way of premi)m of the whole or part of the )nderta2ing of the company% b)t witho)t any ded)ction in respect of income/tax or s)per/tax% or any other tax or d)ty on income or for expendit)re by way of intersection debent)res or otherwise on capital acco)nt or on acco)nt of any s)m which may be set aside in each year to of the profits for reser+e of any other special f)nd. '" #his section shall not apply to a pri+ate company except a pri+ate company which is the s)bsidary company of a p)blic company or to any company whose principal b)siness is the b)siness of ins)rance. 1.%. ,oans to mana4in4 a4ents.## !" 4o company shall ma2e to managing agent of the company or to any partner of the firm if the managing agent is a firm or to any member of director of the pri+ate company if the managing agent is a pri+ate company any loan o)t of moneys of the company or g)arantee any loan made to a managing agent. (" 4othing contained in this section shall apply to any credit held by a managing agent in c)rrent acco)nt by the company with the managing agent for the p)rpose of the b)siness of the company: 1ro+ided that the 6oard of 5irectors may specify the limit of s)ch credit. 9" In the e+ent of any contraception of s)b/section !" any director of the company who is a party to the ma2ing of the loan or gi+ing of the g)arantee shall be p)nishable with fine which may extend to fi+e tho)sand ta2a and% if defa)lt is made in repayment of the loan or discharging the g)arantee% shall be liable .ointly and se+erally for the amo)nt )npaid. '" 4othing in this section shall apply to a pri+ate company except a pri+ate company which is the s)bsidiary of a p)blic company. 3" Except with the consent of three/fo)rths of the directors present and entitled to +ote on the resol)tion% a managing agent of the company% or the firm of which he is a partner% or any partner of s)ch firm or% if the managing agent is a pri+ate company a member or director thereof% shall not enter into any contract for the sale% p)rchase or s)pply for goods and materials with the company. 1.1. ,oans to o( by companies unde( the same mana4ement.## !" 4o company incorporated )nder this Act which is )nder the management of a managing agent shall ma2e any loan to or g)arantee any loan made the any company )nder management of the same managing agent: 1ro+ided that nothing herein contained shall apply to loans made or g)arantees gi+en by a company to or on behalf of a company )nder its own management or loans made by or to a company to or by a s)bsidiary thereof or to g)arantees gi+en by a company on behalf of a s)bsidiary thereof.

3B

(" In the e+ent of any contraception of the pro+isions of this section% any director or officer of the company ma2ing the loan or gi+ing the g)arantee% who is 2nowingly and wilf)lly in defa)lt% shall be liable to a fine not exceeding fi+e tho)sand ta2a and shall .ointly and se+erally be liable for any loss inc)rred by the company in respect s)ch of loan or g)arantee. 1... Pu(chase by company of sha(es of company unde( same mana4in4 a4ent.## A company other than an in+estment company% that is to say% a company whose principal b)siness the ac8)isition and holding of shares% stoc2s% debent)res or other sec)rities% shall not p)rchase shares or debent)res of any company )nder management by the same managing agent% )nless the p)rchase as been pre+io)sly appro+ed by )nanimo)s decision of the 6oard of 5irectors of the p)rchasing company. 1.0. est(iction on mana4in4 a4ent@s po$e(s of mana4ement.## A managing agent shall not exercise% in respect of any company of which he is a managing agent% a power to iss)e debent)res or% except with the a)thority of the directors and within the limits fixed by them% a power to in+est the f)nds of the company and any delegation of any s)ch powers by a company to a managing agent shall be +oid. 1.4. 'ana4in4 a4ent not to en4a4e in business competin4 $ith the business of mana4ed company. ## A managing agent shall not on his own acco)nt an engage in any b)siness which is of the same nat)re as and directly competes with the b)siness carried on by a company )nder his management or by a s)bsidiary company of s)ch company. 1.&. ,imit on numbe( of di(ecto( appointed by mana4in4 a4ent.## / 4otwithstanding anything contained in the articles of a company other than a pri+ate company% the directors appointed by the managing agent shall not exceed in n)mber one/third of the whole n)mber of directors. C!NT ACTS 1.6. ?alidity of $(itten and un$(itten cont(acts.## !" $ontracts on behalf of a company may be made as follows% that is to say// i" any written contract which% if made between indi+id)al% wo)ld be by law re8)ired to be in writing% signed by the parties to be charged therewith% may be made on behalf of the company in writing signed by any person acting )nder its a)thority% express or implied% and may in the same manner be +aried or discharged; and (" All contract made according to this section shall be effect)al in law and shall bind the company and its s)ccessors and all other parties thereto% their heirs% of legal representati+es% as the case may be. 1.". ;ills of e3chan4e and p(omisso(y note.## A bill of exchange% h)ndi or promissory note shall be deemed to ha+e been made% drawn% accepted or endorsed on behalf of a company if made% drawn% accepted or endorsed in the name of% or on behalf or on acco)nt of% the company by any person acting )nder its a)thority express or implied. 1.8. +3ecution of deeds.## A company may% by writing )nder its common seal empower any person% either generally or in respect of any specified matters% as its attorney to exec)te deeds on its behalf in any place% either in or o)tside 6angladesh; and e+ery deed signed by s)ch attorney% on behalf of the company and )nder his seal% where sealing is re8)ired% shall bind the company and ha+e the same effect as if it were )nder its common seal.

3!

1.9. Po$e( of company to ha9e official seal fo( use ab(oad.## !" A company whose ob.ects re8)ire or comprise the transaction of b)siness beyond the limits of 6angladesh may% if a)thorised b)y its articles% ha+e for )se in any territory% district or place not sit)ated in 6angladesh% an official seal which shall be a facsimile of the common seal of the company with the addition on its face of the name of e+ery territory% district of place where it is to be )sed. (" A company ha+ing s)ch an official seal may% by writing )nder its common seal% a)thorise any person appointed for the p)rpose in any territory% district or place not sit)ated in 6angladesh to affix the same to any deed or other doc)ment to which the company is party in that territory% district or place and s)ch person shall be the agent for p)rpose of )sing the said seal. 9" #he a)thority of any s)ch agent shall% as between the company and any person dealing with the agent% contin)e d)ring the period% if any% mentioned in the instr)ment conferring the a)thority% or if no period is there mentioned% then )ntil notice of the re+ocation or determination of the agent7s a)thority has been gi+en to the person dealing with him. '" #he person affixing any s)ch official seal shall% by writing )nder his hand% on the deed or other doc)ment to which the seal is affixed% certify the date and also the territory% district or place or affixing the same. 3" A deed or other doc)ment to which an official seal is d)ly affixed shall bind the company as if it had been sealed with the common seal of the company. 10%. /isclosu(e of inte(est by di(ecto( in (espect of cont(act etc.## !" E+ery director who is directly or indirectly concerned or interested in any contract or arrangement entered into by or on behalf of the company shall disclose the nat)re of his interest at the meeting of the directors at which the contract or arrangement is determined on% of his interest then exists% or% in any other case% at the first meeting of the directors after the ac8)isition of his interest or the ma2ing of the contract or arrangement: 1ro+ided that general notice that a director is a director or a member of any specified company or of any specified firm% and is to be regarded as interested in any s)bse8)ent transaction with s)ch firm or company% shall as regards any s)ch transaction be s)fficient disclos)re within the meaning of there is s)b/section and after s)ch general notice% it shall not be necessary to gi+e any special notice relating to any partic)lar transaction with s)ch firm or company. (" E+ery director who contra+enes the pro+isions of s)b/section !" shall be liable to a fine not exceeding fi+e tho)sand ta2a. 9" A register shall be 2ept by the company in which shall be entered partic)lars of all contracts or arrangements to which s)b/section !" applies% and which shall be open to inspection by any member of the company at the registered office off the company d)ring b)siness ho)rs. '" Eery officer of the company who 2nowingly and willf)lly acts in contra+ention of the pro+isions of s)b/section (" shall be liable to a fine not exceeding one tho)sand ta2a. 101. P(ohibition of 9otin4 by inte(ested di(ecto(.## !" 4o director shall% as a director% +ote on any contract or arrangement in which he is either directly or indirectly concerned or interested% nor shall his presence co)nt for the p)rpose of forming a 8)or)m at the time of any s)ch +ote% and if he does so +ote% his +ote shall not be co)nted:

3(

1ro+ided that the directors or them may +ote on any contract of indemnity against any loss which they or any one or more of them may s)ffer by reason of becoming or being s)reties or s)rety for the company. (" E+ery director who contra+ences the pro+ision of s)b/section !" shall be liable to a fine not exceeding fi+e tho)sand ta2a. 9" #his section shall not apply to a pri+ate company: 1ro+ided that where a pri+ate company is s)bsidiary company of a p)blic company% this section shall apply to all contracts or arrangements made on behalf of the s)bsidiary company with any person other than the holding company. 10.. /isclosu(e to membe(s in case o( cont(act appointin4 a mana4e(.## !" Where a company enters into a contract for the appointment of a manager or managing agent or the company in which contract any director of the company is directly of indirectly concerned or interested% or +aries any s)ch existing contract% the company shall% within twenty/one days from the date or entering into the contract or the +erying of the contract% send an abstract of the terms of s)ch contract or +ariation% as the case may be together with a memorand)m clearly indicating the nat)re of the interest of the director in s)ch contract% or in s)ch +ariation% to e+ery member; and the contract shall be open to inspection of any member at the registered office of the company. (" If a company ma2es defa)lt in complying with the re8)irements of s)b/section !"% it shall be liable to a fine not exceeding fi+e tho)sand ta2a; and e+ery officer of the company% who is 2nowingly and willf)lly in defa)lt% shall be liable to the li2e penalty. 100. Cont(acts by a4ents of company in $hich company is undisclosed p(incipal.### !" E+ery manger or other agent of a company other than a pri+ate company% not being the s)bsidiary company of a p)blic company% who centers into a contract for or on behalf of the company in which contract the company is an )ndisclosed principal shall% at the time of entering into the contract% ma2e% a memorand)m in writing of the contract% and specify therein the person with whom it has been made. (" E+ery s)ch manager or other agent shall forthwith deli+er the memorand)m aforesaid to the registered office of company and send copies to the directors% and s)ch memorand)m shall be filed in the office of the company and laid before the directors at the next directors meeting. 9" If any s)ch manager or other agent ma2es defa)lt in complying with the re8)irements of this section// a" the contract shall% at the option of the company% be +oid as against the company; and b" s)ch manager or other agent shall be liable to a fine not exceeding fi+e h)ndred ta2a. P(ospectus 104. /atin4 of p(ospectus.###A prospect)s iss)ed by or on behalf of a company or in relation to an intended company shall be dated% and that date shall% )nless the contrary is pro+ed% be ta2en as the date of p)blication of the prospect)s. 10&. 'atte(s to be stated and (epo(ts to be set out in p(ospectus.## !" E+ery prospect)s iss)ed by or on behalf of a company% or by on behalf of any person who is or has been engaged

39

or interested in the formation of a company shall state the matters and set o)t the reports specified in parts I and II respecti+ely of sched)le III; and the said 1arts I and II shall ha+e effect s)b.ect to the pro+isions contained in 1art III of the said Sched)le. (" Where an applicant for shares or debent)res of a company it re8)ired to accept a condition which has the effect of wai+ing the compliance with any of the re8)irements of this section% or which p)rports to effect him with notice of any contract doc)ment of matter not specifically referred to in the prospect)s% s)ch condition shall be +oid. 9" 4o person shall iss)e any form of application for shares in or debent)res of a company% )nless the form is accompanied by a prospect)s which complies with the re8)irements of this section: 1ro+ided that this s)b/section shall not apply if it is shown that the form of application was iss)ed either// a" in connection with a bonafide in+itation to a person to enter into an )nderwriting agreement with respect to the shares or debent)res; or b" in relation to shares or debent)res which were not offered to the p)blic. '" If any person acts in contra+ention of the pro+ision of s)b/section 9" he shall be p)nishable with fine which may extend to fi+e tho)sand ta2a. 3" A director or other person responsible for the prospect)s shall not inc)r any libaility by reason of any non compliance with% or contra+ention of% any of the re8)irements of this section if// a" as regards any matter not disclosed% he pro+es that he had no 2nowledge thereof; or b" he pro+es that the non/compliance or contra+ention arose form an honest mista2e of the fact on his part; or c" the non/compliance or contra+ention in respect or matters which in the opinion of the co)rt dealing with the case% were inmaterial or was otherwise s)ch as o)ght% in the opinion of that co)rt% ha+ing regard to all the circ)mstances of the case% reasonably to be exc)sed : 1ro+ided that no director or other person shall inc)r any liability in respect of the fail)re to incl)de in a prospect)s a statement with respect to the matters specified in cla)se !A of 1art I of Sched)le III% )nless it is pro+ed that he had 2nowledge of the matters not disclosed. >" #his section section not apply// a" to the iss)e to existing members or debent)res holders of a company of a prospect)s or form of application relating to shares in or debent)res of the company% whether an applicant for shares or bebert)re will or will not ha+e the right to reno)nce in fa+o)r of other persons : b" to the iss)e of a prospect)s or form of application relating to shares or debent)res which are% or are to be% in all respects )niform with shares or debent)res pre+io)sly iss)ed and for the time being dealt in of 8)oted on a recognised stoc2 exchange;

3'

b)t s)b.ect as aforesaid% this section shall apply to a prospect)s or a form of application% whether iss)ed on or with reference to the formation of a company or s)bse8)ently. ?" 4othing in this section shall limit or diminish any liability which any person may inc)r )nder any other law or )nder this Act apart from this section. 106. +3pe(t to be unconnected $ith fo(mation o( mana4ement o( company.## A prospect)s in+iting persons to s)bscribe for shares in or debent)res of a company shall not incl)de a statement p)rporting to be made by and expert% )nless the expert is a person who is not% and has not been% engaged or interested in the formation or promotion or management of the company. 10" +3pe(t@s consent to issue of p(ospectus containin4 statement by him.## A prospect)s in+iting persons to s)bscribe for shares in or debent)res of a company and incl)ding a statement p)rporting to be made by and expert may be iss)ed% if/// a" he has gi+en his written consent to the iss)e thereof % with the statement incl)ded in the form and context in which it is incl)ded% and has not withdrawn s)ch consent before the deli+ery of a copy of the prospect)s for registration; and b" another statement that he has gi+en and has not withdrawn his consent as aforesaid appear7s in the prospect)s. 108. e4ist(ation of p(ospectus.### !" 4o prospect)s shall be iss)ed by or on behalf of a company or in relation to an intended company )nless% on or before the date of its p)blication% there has been deli+ered to the Registrar for registration a copy thereof signed by e+ery person who is named there in as a director or proposed director of the company% or by his agent a)thorised in writing. (" #he copy of the prospect)s deli+ered to the Registrar for registration )nder s)b/section !" shall ha+e endorsed thereon or attached thereto// a" any consent of the iss)e of the prospect)s re8)ired by section !9? from any person as an expert; and b" in the case of a prospect)s iss)ed generally% also// i" a copy of e+ery contract specified in cla)se !> of part of a Sched)le III or in the case of a contract not red)ced into writing a memorand)m gi+ing f)ll partic)lars thereof; and ii" where the persons ma2ing any report re8)ired by 1art II of that Sched)le Ha+e made therein% or ha+e% witho)t gi+ing the reasons% indicated therein% any s)ch ad.)stments as are mentioned in cla)se persons setting o)t the ad.)stments and gi+ing the reasons therefor. 9" E+ery prospect)s to which s)b/section !" applies shall% on the face of it// a" state that a copy has been deli+ered for registration as re8)ired by this section; b" specify any doc)ment re8)ired by this section to be endorsed on or attached to the copy so deli+ered; and c" a list of statements incl)ded in the prospect)s.

33

'" #he Registrar shall not register a prospect)s )nless the re8)irements of section !9'% !93% !9> and !9? and s)b/section !"% (" and 9" of this section ha+e been complied with and the prospect)s is accompanied by the consent in writing of the person% if any % named therein as the a)ditor% legal ad+iser% attorney% solicitor% ban2er or bro2er of the company or intended company% to act in that capacity. 3" 4o 1rospect)s shall be iss)ed more than ninety days after the date on which a copy there of is deli+ered for registration% and if a prospect)s is so iss)ed% it shall be deemed to be a prospect)s a copy of which has not been deli+ered )nder this section to the Registrar. >" If a prospect)s is iss)ed witho)t a copy thereof being deli+ered )nder this section to the Registrar or witho)t the copy so deli+ered ha+ing been endorsed thereon or attached thereto the re8)ired consent or doc)ments% the company% and e+ery person who is 2nowingly and willingly a party to the iss)e of the prospect)s% shall be p)nishable with the fine which may extend to fi+e tho)sand ta2a. 109. Penalty fo( cont(a9ention of section 106 and 10".## !" If any prospect)s is iss)ed in contra+ention of sections !9> or !9?% the company and e+ery person. who is 2nowingly a party to the iss)e thereof% shall be p)nishable with fine which may extend to fi+e tho)sand ta2a. (" :or the p)rposes of this section and section !9> and !9?% the expression 0expert0 incl)des an engineer% a +al)er% an acco)ntant and any other person whose profession gi+es a)thority to a statement made by him. 14%. Allotment of sha(es and debentu(es to be dealt in on stoc< e3chan4e## /Where a prospect)s% whether iss)ed generally or not% states that an application has been or will be made for permission for the shares or debent)res offered thereby to be dealt in one or more recognised stoc2 exchanges% s)ch prospect)s shall state the name of the stoc2 exchange or % as the case may be% each s)ch stoc2 exchange. and any allotment made on an application in p)rs)ance of the prospect)s shall be +oid% if the permission has not been applied for before the tenth day after the first iss)e of the prospect)s% or where s)ch permission has been applied for before iss)e of prospect)s% if the permission has not been granted by the first iss)e of the prospect)s% or where s)ch permission has been applied for before iss)e of prospect)s% if the permission has not been granted by the stoc2 exchange or each s)ch stoc2 exchange% as the case may by% within six wee2s after the date of the closing of the s)bscription. (" Where the permission referred to in s)b/section !" has not been applied for or% s)ch permission ha+ing been applied for% has not been granted as specified in that s)b/section% the company shall repay witho)t interest all moneys recei+ed from applicants in p)rs)ance of the prospect)s% and if any s)ch money is not repaid within thirty days after the tenth day or as the case may be% the six wee2s as specified in that s)b/section% the directors of the company shall be .ointly and se+erally liable to repay that money with interest at the rate of fi+e percent abo+e the ban2 rate : 1ro+ided that a director shall not be liable if be pro+es that the defa)lt in he payment of the money was not d)e to any miscond)ct or negligence on his part. 9" All moneys recei+ed as s)bscription for the allotment of shares or debentr)res shall be 2ept in a separate ban2 acco)nt and shall be repaid within the time and the manner specified in s)b/ section (" and if defa)lt is made in complying with this s)b/section the company and e+ery officer of the company who is 2nowingly and willf)lly in defa)lt shall be p)nishable with fine not exceeding fi+e tho)sand ta2a%

3>

'" Where an applicant for shares or debent)res is re8)ired to accept a condition has the which has the effect of wai+ing compliance with any re8)irement of this section shall be +oid. 3" :or the p)rposes of this section% permission shall not be deemed to be ref)sed if it is intimated that the application for it will be gi+en f)rther consideration. >" #he other pro+isions of this section shall ha+e effect/// a" in relation to any shares or debent)res agreed to be ta2en by a person )nderwriting an offer thereof by a prospect)s% as if he had applied thereof in p)rps)ance of the prospect)s; b"?' in relation to prospect)s offering shares for sale% with the following modifications% namely :/// i" references in the said other pro+isions to sale shall be s)bstit)ted for references to allotment; ii" the persons by whom the offer is made% and not the company% shall be liable )nder s)b/section ("% to repay money recei+ed from applicants% and references to the company7s liability )nder that s)b/section shall be constr)ed accordingly; and iii" for the reference in s)b/section 9" to 0the company0 and 0e+ery officer of the company who is 2nowingly and willf)lly in defa)lt%0 there shall be s)bstit)ted a reference to 0any person by or thro)gh whom the offer is made0 and who is 2nowingly and willf)lly g)ilty or% willf)lly% a)thorises or permits% the defa)lts0 respecti+ely. ?" 4o prospect)s shall state that application has been made for permission for the shares or debent)res offered there by for being dealt an stoc2 exchange% )nless it is a recognised stoc2 exchange. 141. !bli4ations of companies $he(e o p(ospectus issued.### !" A company ha+ing a share capital which does not iss)e a prospect)s on or with reference to its formation% on which has iss)ed s)ch a prospect)s b)t has not proceeded to allot any of its shares or debent)res offered to the p)blic for s)bscription shall not allot any of its shares or debent)res )nless within three days after the first allotment of either shares or debent)res% there has been deli+ered to the Registrar for registration a statement in lie) of prospect)s% signed by e+ery person who is named therein as director or proposed director of the company or his agent a)thorised in writing in the form and containing the partic)lars set o)t in part I of Sched)le IE and% in the cases mentioned in 1art II of that Sched)le% setting o)t the reports specified therein% and the said 1art I and II shall ha+e effect s)b.ect to the pro+isions contained in 1art III of that Sched)le. (" E+ery statement in lie) of prospect)s deli+ered )nder s)b/section !" shall% where the persons ma2ing many s)ch report as specified that s)b/section ha+e made therein% or ha+e witho)t gi+ing the reasons indicated therein% any s)ch ad.)stments as are mentioned in 1art III of the Sched)le IE ha+e endorsed thereon or attached thereto a written statement signed by those person% setting o)t the ad.)stment and gi+ing the reasons thereof. 9" #his section shall not apply to a pri+ate company. '" If a company acts in contra+ention of s)b/section !" or (" the company and e+ery director of the company and e+ery director of the company who 2nowingly and willf)lly a)thorise; or permits the contra+ention% shall be p)nishable with fine which may extend to two tho)sand ta2a.

3?

3" Where a statement in lie) of prospero)s deli+ered to the Registrar )nder s)b/section !" incl)des any )ntr)e statement% any person who a)thorised or permitted the deli+ery of the statement in lie) of prospect)s for registration shall be p)nishable with imprisonment for a ten years or with fine which may extend to two years or with fine which may extend fi+e tho)sand ta2a or with both% )nless he pro+es either that the statement was immaterial or that he had reasonable gro)nd to belie+e% and did )p to the time of the deli+ery for registration of the statement lie) of prospect)s belie+e% that the statement was tr)e >" for the p)rposes of this section/// a" a statement incl)ded in a statement in lie) of prospect)s shall be deemed to be )ntr)e% if it is misleading in the form and context in which it is incl)ded; and b" where the omission from a statement in lie) of prospect)s of any matter is calc)lated to mislead% the statement in lie) of prospect)s shall be deemed% in respect to s)ch omission% to be a statement in lie) of prospect)s containing an )ntr)e statement. ?" :or the p)rposes of s)b/section 3" and cla)se a" of s)b/section >" the expression 0incl)ded0% when )sed with reference to a statement in lie) of prospect)s% means incl)ded in the statement in lie) of prospect)s itself of contained in any report or memorand)m appearing on the face thereof or by reference incorporated therein% or iss)ed therewith. 14.. /ocument containin4 offe( of sha(es o( debentu(es fo( sale to be deemed a p(ospectus### !" where a company allots or agrees to allot any shares in or debent)res of the company with a +iew to all or any of those shares or debent)res being offered for sale to the p)blic% any doc)ment by which the offer for sale to the p)blic is made shall% for all p)rposes be deemed to be a prospect)s iss)ed by the company% and all enactment7s and r)les of law as to the contents of prospect)s and as to liability in respect of statements in and omissions from prospect)s% or otherwise relating to prospect)s% shall apply and ha+e effect accordingly% if the shares or debent)res had been offered to the p)blic for s)bscription and as if the persons accepting the offer in respect of any shares or debent)res were s)bscribers for those shares or debent)res b)t witho)t pre.)dice to the liability% if any% of the persons by whom the offer is made in respect of misstatements contained in the doc)ment or otherwise in respect thereof. (" :or the p)rposes of this Act% it shall% )nless the contrary is pro+ed% be e+idence that an allotment or an agreement to allot shares or debent)res was made with a +iew to the shares or debent)res being offered for sale to the p)blic if it is shown/// a" that an offer of the shares or debent)res or of any of them for sale to the p)blic was made within one h)ndred and eighty days% after the allotment or agreement to allot; or b" that at the date when the offer was made% the whole consideration to be recei+ed by the company in respect of the shares or debent)res had not been so recei+ed. 9" In case of the doc)ment% mentioned in s)b/section !"% section !93 shall ha+e effect as if it re8)ired a prospect)s to state% in addition to the matters re8)ired by that section to be stated% in a prospect)s/// a" the net amo)nt of the consideration recei+ed or to be recei+ed by the company in respect of the shares or debent)res to which the offer relates; and b" the place and time at which the contract )nder which the said shares or debent)res ha+e been or are to be allotted may be inspected.

3A

'" Section !9A shall apply to the person of persons ma2ing the offer mentioned in s)b/section !" as tho)gh they were person named in a prospect)s as directors or proposed directors of a company. 3" Where the persons ma2ing an offer mentioned in s)b/section !" is a company or firm% it shall be s)fficient if the doc)ment referred in s)b/section !" is signed on behalf of the company or firm by two directors of the company or by not less than one/half of the partners in the firm% as the case may be% and any s)ch director or partner may sigh by his agent a)thorised in writing. 140. *nte(p(etation of p(o9isions (elation to p(ospectus.### !" :or the p)rposes of the pro+isions relating to prospect)s/// a" a statement incl)ded in a prospect)s shall be deemed to be )nt)re% if the statement is misleading in the form and context in which it is incl)ded; and b" where the omission from a prospect)s of any matter is calc)lated to mislead% the prospect)s shall be deemed in respect of s)ch omission to be a prospect)s containing )ntr)e statement. (" :or the p)rposes of section !'3% !'> and cla)se a" of s)b/section !" of this section% the expression 0incl)ded0 when )sed with reference to a prospect)s% means incl)ded in the prospect)s itself or contained in any report of memorand)m appearing on the face thereof or by reference incorporated therein or iss)ed therewith. 144. est(iction on alte(ation of te(ms of p(ospectus o( statement in lieu of p(ospectus.##/ A company shall not% at nay time% +ery the terms of a contract referred to in the prospect)s or statement in lie) of prospect)s% except with the appro+al of% or except )nder an a)thority gi+en by% the company in general meeting. 14&. Ci9il liability fo( misstatement in p(ospectus.### !" S)b.ect to the pro+isions of this section% where a prospect)s in+ites members of the p)blic to s)bscribe for shares in or debent)res of a company% the following persons shall be liable to pay compensation to e+ery person who s)bscribes for any shares or debent)res on the faith of the prospect)s for any loss or damage he may ha+e s)stained by reason of any )ntr)e statement incl)ded therein% that is to say/// a" e+ery person who is a director of the company at the time of the iss)e of prospect)s; b" e+ery person who has a)thorised himself to be named and is named in the prospect)s either as a director% or as ha+ing agreed to become a director% either immediately or after an inter+al of some time; c" e+ery person who is a promoter of the company; and d" e+ery person who has a)thorised the iss)e of the prospect)s : 1ro+ided that where% )nder section !9A% the consent of a person is re8)ired to the iss)e of a prospect)s and he has gi+en that consent% or where the consent of a person named in a prospect)s is re8)ired and he has gi+en that consent% he shall not% by reason of ha+ing gi+en s)ch consent% be liable )nder this s)b/section as a person who has% as referred to in cla)sed d"% a)thorised the iss)e of the prospect)s% except in respect of an )ntr)e statement% if any% which is incl)ded in accordance with section !9? with the consent or )nder the a)thority of a person p)rporting to be an expert. (" 4o person shall be liable )nder s)b/section !"% if he pro+es///

3&

a" that ha+ing consented to become a director of the company% he withdrew his consent before the iss)e of the prospect)s% and that it was iss)ed witho)t his a)thority or consent; or b" that the prospect)s was iss)ed witho)t his 2nowledge or consent% and that on becoming aware of its iss)e he forthwith ga+e reasonable p)blic notice that it was iss)ed witho)t his 2nowledge or consent; or c" that% after the iss)e of the prospect)s and before allotment there)nder% he% on becoming aware of any )ntr)e statement therein% withdrew his consent to the prospect)s and ga+e reasonable p)blic notice of the withdrawal and of the reason therefor; or d" that/// i" as regards e+ery )ntr)e statement not p)rporting to be made on the a)thority of an expert or of a p)blic official doc)ment or statement% he had reasonable gro)nd to belie+e% and did )p to the time of the allotment of the shares or debent)res% as the case may be% belie+e that the statement was tr)e; and ii" as regards e+ery )ntr)e statement p)rporting to be a statement by an expert or contained in what p)rports to be a copy of or an extract from a report or +al)ation of an expert% it was a correct and fair presentation of the statement% or a correct copy of or a correct and fair extract from% the report and +al)ation; and he had reasonable gro)nd to belie+e% and did )p to the time of the iss)e of the prospect)s belie+e% that the person ma2ing the statement was competent to ma2e it and that person had gi+en the consent re8)ired by section !9? to the iss)e of the prospect)s and had not withdrawn that consent before deli+ery of a copy of the prospect)s for registration or% to the defendant7s 2nowledge% before allotment there)nder: and iii" as regards e+ery )ntr)e statement p)rporting to be a statement made p)rporting to be a statement made by an official person or contained in what p)rports to be a copy of or extract from a p)blic official doc)ment% it was a correct and fair representation of that statement% or correct copy of or a correct and fair extract from% the doc)ment : 1ro+ided that this s)b/section shall not apply in the case of a person liable by reason of his ha+ing gi+en a consent re8)ired of him by section !9? as a person who has a)thorised the iss)e of the prospect)s in respect of an )ntr)e statement p)rporting to be made by him as an expert. 9" A person who% wo)ld% )nder s)b/section !" be liable by reason of his ha+ing gi+en a consent re8)ired of him by section !9? as a person who has a)thorised the iss)e of a prospect)s in respect of an )ntr)e statement p)rporting to be made by him as an expert% shall not be so liable% if he pro+es/// a" that ha+ing gi+en his consent )nder section !9? to the iss)e of the prospect)s% he withdrew it in writing before deli+ery of a copy of the prospect)s for registration; or b" that% after deli+ery of a copy of the prospect)s for registration and before allotment there)nder% he% on becoming aware of the )ntr)e statement% withdrew his consent in writing and ga+e reasonable p)blic notice of the withdrawal and of the reason therefor; of c" that he was competent ma2e the statement and that he had reasonable gro)nd to belie+e% and did )p to the time of the allotment of the shares or debent)res% belie+e% that the statement was tr)e. '" Where//

>B

a" the prospect)s specifies the name of a person as a director of the company% or as ha+ing agreed to become a director thereof% and he has not consented to become a director% or has withdrawn has consent before the iss)e of the prospect)s% and has not a)thorised or consented to the iss)ed thereof; or b" the consent of a person is re8)ired )nder section !9? to the iss)e of the prospect)s and be either has not gi+en that consent or has withdrawn it before iss)e of the prospect)s. the directors of the company excl)ding those witho)t whose 2nowledge or consent the prospect)s was iss)ed and e+ery other person who a)thorised the iss)e thereof% shall be liable to indemnify the person referred to in cla)se a" or cla)se b"% as the case may be%% against all damages% costs and expenses to which be may be made liable by reason of his name ha+ing been interested in the prospect)s or of the incl)sion therein of a statement p)rporting to be made by him as an expert% as the case may be% or in defending himself in any s)it or legal proceeding bro)ght against him in respect thereof: 1ro+ided that a person shall not for the p)rposes of this s)b/section be deemed to ha+e a)thorised the iss)e pf a prospect)s by reason only of his ha+ing gi+en the consent re8)ired by section !9?. 3" E+ery person who% becomes liable to ma2e any payment by +irt)e of this section may reco+er contrib)tion% as in cases of contract% from any other person who% if iss)ed separately% wo)ld ha+e been liable to ma2e the same payment% )nless the former person was% and the later person was not% g)ilty of fra)d)lent misrepresentation. >" :or the p)rposes of this section/// a" the expression 0promoter0 means a promoter who was a party to the preparation of the prospect)s or of the portion thereof containing the )ntr)e statement% b)t does not incl)de any person by reason of his acting a professional capacity for persons engaged in proc)ring the formation of the company; and b" the expression 0expert0 has the same meaning as in section !9&. 146. Penalty fo( untu(e statement in p(ospectus.### !" Where a prospect)s iss)ed after the commencement of this Act incl)des any )ntr)e/statement e+ery person who a)thorised the iss)e of the prospect)s shall be p)nishable with imprisonment for a term which may extend to two years% or with fine which may extend to fi+e tho)sand ta2a or with both% )nless he pro+es either that the statement was immaterial or that he had reasonable gro)nd to belie+e% and did% )p to the time of the iss)e of the prospect)s% belie+e the statement was tr)e. (" A person shall not be deemed for the p)rposes of this section to ha+e a)thorised the iss)e of a prospect)s by reason only of his ha+ing gi+en/// a" the consent re8)ired by section !9? to the incl)sion therein of statement p)rporting to be made by him as an expert ; or b" the consent re8)ired by s)b/section '" of section !9A. 14". Penalty fo( f(audulently inducin4 pe(sons to in9est money 5 Any person who either by 2nowingly or rec2lessly ma2ing any statement% promise or forecast which is false% decepti+e of misleading% or by ind)ce another person to enter into% or to offer into///

>!

a" any agreement for% or with a +iew to ac8)iring% disposing of% s)bscribing for% or )nderwriting shares or debent)res; or b" any agreement% the p)rpose or pretended p)rpose of which is to sec)re a profit to any of the parties from the yield of shares or debent)res% or by reference to fl)ct)ation in the +al)e of shares or debent)re. shall be p)nishable with imprisonment for a term which may extend to fi+e years or with fine which my extend to fifteen tho)sand ta2a or with both. 148. est(iction as to allotment.### !" 4o allotment shall be made of any share capital of a company offered to the p)blic for s)bscription% )nless the following amo)nt and at least 3G of that amo)nt ha+e been paid in cash to the company% namely/// a" the amo)nt stated in prospect)s as the minim)m amo)nt which in the opinion of the directors% m)st be raised by the iss)e of share capital in order to pro+ide for the matters specified in s)b/section ("; b" if any part of the minim)m amo)nt is to be defrayed in any other manner% the balance of the minim)m amo)nt after ded)ction the amo)nt re8)ired to be so defrayed. (" #he matters for which pro+ision for the raising of a minim)m amo)nt of share capital m)st be made by the directors are the following namely/// a" the p)rchase price of any property p)rchased or to be p)rchased which is to be defrayed in whole or in part o)t of the proceeds of the iss)e ; b" any preliminary expenses payable by the company and any commission so payable to any person in consideration of his agreeing to s)bscribe for or of his proc)ring or agreeing to proc)re s)bscriptions for any shares in the company; c" the repayment of any moneys borrowed by the company in respect of the foregoing matters ; and d" wor2ing capital. 9" #he amo)nt referred to in s)b/section !" as the amo)nt stated in the prospect)s shall be rec2oned excl)si+ely of any payable otherwise than in cash and is in this Act referred to as the minim)m s)bscription. '" All moneys recei+ed from applicants for shares shall be deposited and 2ept in a sched)led ban2 as defined in the 6angladesh ban2 ,rder% !&?( 1, 4o. !(? of !&?( "% )ntil ret)rned in accordance with the pro+isions of s)b/section ?" or )ntil the certificate to commence b)siness is obtained )nder section !3B (". 3" In the e+ent of any contra+ention of the pro+isions of s)b/section '" e+ery promoter% director or other person 2nowingly responsible for s)ch contra+ention shall be liable to a fine not exceeding fi+e tho)sand ta2a. >" #he amo)nt payable on application on each share shall not be less than fi+e percent of the nominal amo)nt of the share. ?" If the conditions aforesaid ha+e not been complied with within a period not exceeding one h)ndred and eighty days the first iss)e of the prospect)s% or within forty days from the closing

>(

date of s)bscription/list as specified in the prospect)s% whiche+er is earlier% all moneys recei+ed form applicants of shares or debent)res shall be forthwith repaid to them witho)t interest% and if any which money is not so repaid within the aforesaid period% the directors of the company% shall be .ointly and se+erally liable to repay that money with interest at the rate of fi+e percent abo+e the ban2 after expiry of the aforesaid period. A" 4o allotment shall be made of any shares in% or debent)res of% a company in p)rs)ance of a prospect)s iss)ed and no proceedings shall be ta2en on applications made in p)rs)ance of a prospect)s so iss)ed% )ntil the beginning of the eight day after that on which the prospect)s is first so iss)ed or s)ch later time% if any as may be specified in the prospect)s. 1ro+ided that where% after a prospect)s is first iss)ed% a p)blic notice is gi+en by some person responsible )nder section !'3 for the prospect)s which has the effect of excl)ding% limiting or diminishing his responsibility% no allotment shall be made )ntil the beginning of the eighth day after that on which s)ch p)blic notice is first gi+en. &" An application for shares in% or debent)res of% a company% which is made in p)rs)ance of a prospect)s iss)ed shall not be re+ocable )ntil after the expiration of the eighth day after the time of the opening of the s)bscription list% or the gi+ing% before the expiry of the said eighth day by some person responsible )nder section !'3 for the prospect)s% of a p)blic notice ha+ing the effect )nder that section of excl)ding% limiting or diminishing the responsibility of the person gi+ing it. !B" Where an applicant for shares or debent)res is re8)ired to accept condition which has the effect of wai+ing compliance with any re8)irement of this section shall be +oid. !!" #his section% except s)b/section >" thereof% shall not apply to any allotment of shares s)bse8)ent to the first allotment of shares offered to the p)blic for s)bscription. !(" In the case of the first allotment of share capital payable in cash of any company which does not iss)e any in+itation to the p)blic to s)bscribe for its shares% on allotment shall be made )nless the minim)m s)bscription% that is to say/// a" the amo)nt% if any fixed by the memorand)m or articles and named in the prospect)s or in the statement in lie) of prospect)s as the minim)m s)bscription )pon which the director may proceed to allotment; or b" if no amo)nt is so fixed and named% the whole amo)nt of the share capital other than that iss)ed or agreed to be iss)ed as f)lly or partly paid )p otherwise than in cash; has been s)bscribed and an amo)nt not less than fi+e percent of the nominal amo)nt of each share payable in cash has been paid to and recei+ed by the company. !9" S)b/section !(" shall not apply to a pri+ate company or to a company which has allotted any shares or debent)res before the commencement of this Act.

149. +ffect of i((e4ula( allotment. ### !" An allotment made by a company to an applicant in contra+ention of the pro+ision of section !'! or section !'A shall be +oidable at the instance of the applicant within one month after the holding of the stat)tory meeting of the company and not later or% in any case where the company is not re8)ired to hold a stat)tory meeting or where the allotment is made after the holding of the stat)tory meeting% within one month after the date of the

>9

allotment and not later% and shall be so +oidable notwithstanding that the company is in the co)rse of being wo)nd )p. (" If any director of a company 2nowingly contra+enes or permits or a)thorises the contra+ention of any of the pro+isions of section !'! or section !'A with respect to allotment% he shall be liable to compensate the company and the allottee for any loss% damages or costs which the company or the allottee may ha+e s)stained or inc)rred thereby : 1ro+ided that 1roceedings to reco+er any s)ch loss% damages or costs shall not be commenced after the expiration of two years from the date of the allotment. 1&%. est(ictions o( commencement of ;usiness.### !" A company shall not commence any b)siness or exercise any borrowing powers )nless/// a" shares held s)b.ect to the payment of the whole amo)nt thereof in cash ha+e been allotted to an amo)nt not less in the whole than the minim)m s)bscription; and b" e+ery director of the company has% o)t of the shares ta2en or contracted to be ta2en by him% paid in cash on each of the shares. i" where the shares are offered for p)blic s)bscription% an amo)nt e8)al to the amo)nt to be paid on application for shares by the members of the p)blic; or ii" where the shares are not offered% and amo)nt payable in cash by the director on s)ch share : c" there has been field with the Registrar a d)ly +erified declaration by the secretary or one of the directors in the prescribed from% that the aforesaid conditions ha+e been complied with; and d" in the case of a company which does not iss)e a prospect)s in+iting the p)blic to s)bscribe for its shares% there has been filed with the Registrar a statement in lie) of prospect)s. (" #he Registrar shall% on the filing of a d)ly +erified declaration% in accordance with the pro+isions of s)b/section !" certify that the company is entitled to commence b)siness% and that certificate shall be concl)si+e e+idence that the company is so entitled : 1ro+ided that in the case of a company which does not iss)e a prospect)s in+iting the p)blic to s)bscribe for its shares% the Registrar shall not gi+e s)ch a certificate )nless a statement in lie) of prospect)s has been filed with him. 9" Any contract made by a company before the date at which it is entitled to commence b)siness shall be pro+isional only% and shall not be binding on the company )ntil that date and on that date it shall become binding. '" 4othing in this section shall pre+ent the sim)ltaneo)s offer for s)bscription or allotment of any shares% and debent)res or the receipt of any money payable on application for shares or debent)res. 3" If any company commences b)siness or exercises borrowing powers in contra+ention of this section% e+ery person who is responsible for the contra+ention shall% witho)t pre.)dice to any other liability% be liable to a fine not exceeding one tho)sand ta2a for e+ery day d)ring which the contra+ention contin)es.

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>" 4othing in this section shall apply to a pri+ate company% or to a company which does not iss)e a prospect)s in+iting the p)blic to s)bscribe for its shares% and the pro+isions of this section in so far as they relate to shares% shall not apply to a company limited by g)arantee and not ha+ing a share capital.

PA T *? 'ANA8+'+NT AN/ A/'*N*ST AT*!N

!ffice and Name (Continued) 1&1. etu(n as to allotment.# !" Where a company ha+ing a share capital ma2es any allotment of its shares% the company shall within sixty days thereafter% file with Registrar the following doc)ments% namely :// a" a ret)rn of the allotments% stating the n)mber and nominal amo)nt of the shares comprised in the allotment% the name address nationality and other descriptions of the allottees% and the amo)nt% if any% paid or d)e and payable on each share% and b" in the case of shares allotted as f)lly or partly paid )p otherwise than in cash% the copies of the following agreements d)ly stamped and +erified in the prescribed manner namely :/ i" +endor7s agreement% that is the agreement which constit)tes the title of the allotee to the allotment; and ii" the contract of sale or ser+ice or to other consideration in respect of which the allotment was made; c" the n)mber and nominal +al)e of the allotted shares referred to in cla)se b"; and d" the deed of sale of any immo+able property% if the consideration for allotment of shares referred to in cla)se b" is so)ght to the paid by the allottee by way of transfer of s)ch property. (" Where a contract mentioned in s)b/section !" is not red)ced to writing% the company shall% within one month after the allotment% file with the Registrar the prescribed partic)lars of the contract stamped with the same stamp d)ty as wo)ld ha+e been payable if the contract had been red)ced to writing% and these partic)lars shall be deemed to be an instr)ment within the meaning of the Stamp Act% !A&& II of !A&&" and the Registrar may% as a condition of filing the partic)lars% re8)ire that the stamp d)ty payable thereon be ad.)dicated )nder section 9! of that Act. 9" If the Registrar is satisfied that in the circ)mstances of any partic)lar case the period of sixty days specified in s)b/section !" and (" for compliance with the re8)irements of these section is inade8)ate% he may% on an application made by the company before expirys of the sixty days% extend that period as he thin2s fit% and if he does so% the pro+isions of s)b/section !" and (" shall ha+e effect in that partic)lar case as if for the extended period allowed by Registrar specified in those s)b/sections.

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'" If a company defa)lts in complying with the re8)irements of this section% e+ery officer of the company who is 2nowingly a party to the defa)lt shall be liable to a fine not exceeding one tho)sand ta2a for e+ery day d)ring which the defa)lt contin)es : 1ro+ided that% in case of defa)lt in filling with the Registrar within the time specified in s)b/section !" and (" any doc)ment re8)ired to be filed by this section% the company or any person liable for the defa)lt may apply to the $o)rt for relier% and the $o)rt% if satisfied that the commission to file the doc)ment was accidental or d)e to inad+ertence or that on other gro)nds it is .)st and e8)itable to grant relief% may ma2e an order extending the time for the filing of the doc)ment for s)ch a period as the $o)rt may thin2 proper. Commissions and /iscounts 1&.. est(ictions on payment of commissions, discounts, etc.# !" It shall be lawf)l for a company to pay a commission to any person in consideration of his s)bscribing or agreeing to s)bscribe% whether absol)tely or conditionally% for any shares in the company% for proc)ring or agreeing to proc)re s)bscription% whether absol)tely or conditionally for any shares in the company% if/// a" the payment of the commission is a)thorised by the articles and the commission paid or agreed to be paid does not exceed the amo)nt or rate so a)thorised; and b" if the amo)nt or rate of percentage of the commission paid or agreed to be paid is/// i" in the case of shares offered to the p)blic for s)bscription% in the prospect)s; and ii" in the case of shares not offered to the p)blic for s)bscription% disclosed in the statement lie) of prospect)s or in a statement in the prescribed form signed in li2e manner as a statement in lie) of prospect)s and filed with the Registrar and% where a circ)lar of notice% not being a prospect)s in+iting s)bscription for the shares is iss)ed% also disclosed in that circ)lar or notice. (" Sa+e as pro+ided in s)b/section !" and section !39% no company shall allot any of its shares or apply any its moneys either directly of indirectly in payment of any commission. disco)nt or allowances% to any person in confederation of his s)bscribing or agreeing to s)bscribe% whether absol)tely or conditionally% for any shares of the company or proc)ring or agreeing to proc)re s)bscriptions% whether absol)tely or conditionally% for any shares in the company% and the shares shall not be so allotted or the money shall not be so applied by adding to the p)rchase/money of any property ac8)ired by the company or the contract price of any wor2 to be exec)ted for the company or the money to be paid o)t of the nominal p)rchase money or contract price% or otherwise. 9" 4othing in this section shall affect the power of any company to pay s)ch bro2erage as it has heretofore been lawf)l for a company to pay and a +ender to% promoter of% or other person who recei+ed payment in money or shares from% a company shall ha+e and shall be deemed always to ha+e had power to apply any part of the money or shares so recei+ed in payment of any commission% the payment of which% if made directly by the company% wo)ld ha+e been legal )nder this section. 1&0. Po$e( to issues sha(e at a discount. # !" S)b.ect to the pro+isions of this section% it shall be lawf)l for a company to iss)e at a disco)nt shares in the company of a class already iss)ed : 1ro+ided that /

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a" the iss)ed of the shares at a disco)nt m)st be a)thorised by resol)tion passed in general meeting of the company and m)st be sanctioned by the $o)rt; b" the resol)tion m)st specify the maxim)m rate of disco)nt% not exceeding ten percent in any case% at which shares are to be iss)ed; c" not less than one year m)st at the date of iss)ed ha+e clasped since the date on which the company was entitled to commence b)siness; d" the shares to be iss)ed at a disco)nt m)st be iss)ed within six months after the date on which the iss)e is sanctioned by the $o)rt or within s)ch extended time as the $o)rt may allow. (" E+ery prospect)s relating to the iss)e of the shares and e+ery balance sheet iss)ed by the company s)bse8)ently to the iss)e m)st contain partic)lars of the disco)nt allowed on the iss)e of the shares or of so m)ch of that disco)nt as has not been written off at the date of the iss)e of the doc)ment in 8)estion. 9" If accompany defa)lts in complying with s)b/section (" the company and also e+ery officer of the company who is in defa)lt shall be liable to a fine not exceeding fi+e h)ndred ta2a. 1&4. *ssue of (edeemable p(efe(ence sha(es. # !" S)b.ect to the pro+isions of this section% a company limited by shares may% if so a)thorised by its articles% iss)e preference shares which are% or at the option of the company are to be or liable to be redeemed : 1ro+ided that / a" no s)ch shares shall be redeemed except o)t of profits of the company which sho)ld otherwise be a+ailable for di+idend or o)t or the proceeds of a fresh iss)e of shares made for the p)rposes of the redemption or o)t of sale proceeds of any property of the company. b" no s)ch shares shall be redeemed )nless they are f)lly paid; c" where any s)ch shares are redeemed otherwise than o)t of the proceeds of a fresh iss)e% there shall% o)t of profits which wo)ld otherwise ha+e been a+ailable for di+idend% be transferred to a reser+e f)nd% to be called 0the capital redemption reser+e f)nd0 a s)m e8)al to the amo)nt applied in redeeming the shares% and the pro+isions of this relating to the red)ction of the shares capital of a company shall% except as pro+ided in this section% apply if the capital redemption reser+e f)nd were paid )p share capital of the company; d" where any s)ch share are redeemed o)t of the proceeds of a fresh iss)e% the premi)m% if payable on redemption% m)st be pro+ided for o)t of the profits of the company before the shares are redeemed. (" In e+ery balance/sheet of a company which has iss)ed redeemable preference shares the following shall be incl)ded% namely : /// a" a statement specifying what part of the iss)ed capital of the company consists of s)ch shares; and

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b" the date on or before which those shares are% or are to be% liable to be% redeemed or where no definite date is fixed for redemption% the period of notice to be gi+en for redemption. 9" S)b.ect to the pro+isions of this section% the redemption of preference shares may be effected on s)ch terms and in s)ch terms and in s)ch manner as may be pro+ided by the articles of the company. '" Where in p)rs)ance of this section a company has redeemed or is abo)t to redeem any preference shares% it shall ha+e power to iss)e shares )p to the nominal amo)nt of the shares redeemed or to be redeemed% as if those had ne+er been iss)ed% and accordingly the share capital of the company shall not% for the p)rpose of calc)lating the fees payable )nder section 9A'% be deemed to be increased by the iss)e% of shares in p)rs)ance of this s)b/section : 1ro+ided that% where new shares are iss)ed before the redemption of the old shares% the new shares shall not% so far as they relate to stamp d)ty% be deemed to ha+e been iss)ed in p)rs)ance of this s)b/section% )nless the old shares are redeemed within one month after the iss)e of the new shares. 3" 4otwithstanding anything in the other pro+isions of this section% where redeemable preference shares deemed% )nder s)b/section '"% to ha+e ne+er been iss)ed are% or are to be% redeemed for the p)rpose of allotting them as f)lly paid )p bon)s shares to the members of the company% the redemption reser+e f)nd may be applied by the company )p to the nominal +al)e of the new shares referred to in s)b/section !" c" for s)ch redemption. >" If a company defa)lts in complying with any of the pro+isions of this section% the company and also e+ery officer of the company who is in defa)lt shall be liable to a fine not exceeding two tho)gsand ta2a. 1&&. 7u(the( issue of capital. # !" Where the directors decided to increase the s)bscribed capital of the company by iss)e of f)rther shares within the limit of the a)thorised capital / a" s)ch f)rther shares shall be offered to the members in proportion% as nearly as circ)mstances admit% to the capital paid )p on the existing share held by s)ch member% irrespecti+e of class% at the date of the offer; b" s)ch offer shall be made by notice specifying the n)mber of shares offered and specifying the time limit. not being less than fifteen days from the date of the offer% within which the offer if not accepted% will be deemed to ha+e been declined; c" after the expiry of the time specified in the notice aforesaid% or on receipt of earlier intimation from the members to whom s)ch notice is gi+en that he declines to accept the shares offered% the directors may dispose of the same in s)ch manner as they may thin2 most beneficial to the company. (" 4otwithstanding anything contained in s)b/section !" the f)rther shares aforesaid may be offered to any person whether or not those person incl)de its person referred to in cla)se a" of that s)b/section in manner whatsoe+er. 1&6. Statement in balance sheet as to commissions and discounts. # Where a company has paid any s)ms by way of commission in respect of any shares or debent)res or allowed any s)ms by way of disco)nt in respect of any debent)res% the total amo)nt so paid or allowed or so

>A

m)ch thereof as has not been written off% shall be stated in e+ery balance sheet of the company )ntil the whole amo)nt thereof has been written off. Payment of *nte(est out of Capital 1&". Po$e( of company to pay inte(est out of capital in ce(tain cases. # Where any shares of a company are iss)ed for the p)rpose of raising money to defray the expenses of the constr)ction of any wor2s or b)ilding or the pro+ision of any plant which cannot be made profitable for a lengthened period% the company may pay interest on so m)ch of that share capital as is for the time being paid )p for the period and s)b.ect to the conditions and restrictions in this section mentioned and may charge the same to capital as part of the cost of constr)ction of the wor2 or b)ilding or the pro+ision of plant : 1ro+ided that / a" no s)ch payment shall be made )nless the same is a)thorised by the articles or by special resol)tion; b" no s)ch payment whether a)thorised by the articles or by special resol)tion% shall be made witho)t the pre+io)s sanction of the go+ernment; and s)ch sanction shall be concl)si+e e+idence for the p)rposes of this section that the shares of the company in respect of which s)ch sanction is gi+en ha+e been iss)ed for a p)rpose specified in this saction; c" before sanctioning any s)ch payment the go+ernment may% at the expense of the company% appoint a person to in8)ire and report to the *o+ernment as to the circ)mstances of the case% and may% before ma2ing the appointment% re8)ire the company to gi+e sec)rity for the payment of the costs of the in8)iry; d" the payment shall be made only for s)ch period and may be determined by the *o+ernment% and s)ch period shall in no case extend beyond the close of the half/year nest after the half/year d)ring which the wor2s or b)ildings ha+e been act)ally completed or the plant pro+ided; e" the rate of interest shall in no case exceed fo)r percent per ann)m or s)ch lower rate as the *o+ernment% may% by notification in the official *a-ette% prescribe; f" the payment of the interest shall not operate as a red)ction of the amo)nt paid )p on the shares in respect of which it is paid; g" the acco)nts of the company shall show the share capital on which% and the rate at which% interest has been paid o)t of capital d)ring the period to which the acco)nts relate. Ce(tificates of Sha(es, etc. 1&8. ,imitation of time fo( issue of ce(tificates. # !" E+ery company shall% within ninety days after the allotment of any of its shares% debent)res or debent)re/stoc2% and within ninety days after the registration of transfer of any s)ch shares% debent)res or debent)re/stoc2 complete and ha+e ready for deli+ery the certificates of all shares% debent)res% and the debent)re/stoc2 allotted or transferred )nless the conditions of iss)e of the shares% debent)res or debent)re/stoc2 otherwise pro+ide. (" If defa)lt is made in complying with the re8)irements of this section% the company% and also e+ery officer of the company who is 2nowingly a party to the defa)lt shall be liable to a fine not exceeding fi+e h)ndred ta2a for e+ery day d)ring which the defa)lt contin)es.

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*nfo(mation as to 'o(t4a4es, Cha(4es, etc. 1&9. Ce(tain mo(t4a4es and cha(4es to be 9oid if not (e4iste(ed # !" E+ery mortgage or charge created after the commencement of this Act by a company and being either / a" a mortgage or charge for the p)rpose of sec)ring any iss)e of debent)res; or b" a mortgage or charge on )ncalled share capital of the company% or c" a mortgage or charge on any immo+able property where+er sit)ated or any interest therein% or d" a mortgage or charge on any boo2 debts or the company% or e" a mortgage or charge% not being a pledge on any mo+eable property of the company except stoc2/in/ trade% or f" a floating charge on the )nderta2ing or shall so far as any property of the company% sec)rity on the company7s property or )nderta2ing is thereby conferred% be +oid against the li8)idator and any creditor of the company% )nless the prescribed partic)lars of the mortgage or charge% together with the instr)ment% if any% by which the mortgage or charge is created or e+idenced or a copy thereof +erified in the prescribed manner are filed with the Registrar for registration in manner re8)ired by this Act within twenty/one days after the date of its creation ; p)t any contract or obligation for repayment of the money thereby sec)re shall not be pre.)diced; and when a mortgage or charge becomes +oid )nder this section% the money sec)red thereby shall immediately become payable. 1ro+ided that / i" in the case a mortgages or charge created o)t of 6angladesh comprising solely property sit)ate o)tside 6angladesh the said twenty one days shall be co)nted by excl)ding the period which wo)ld be necessary to recei+e the instr)ment in 6angladesh in d)e co)rse had it been posted with d)e diligence; and ii" where the mortgage of charge is created in 6angladesh comprises property o)tside 6angladesh the instr)ment creating or p)rporting to create the mortgage or charge or a copy thereof +erified in the prescribed manner may be filed for registration notwithstanding that f)rther proceedings may be necessary to ma2e the mortgage or charge +alid or effect)al according to the law of the co)ntry in which the property is sit)ate; and iii" where a negotiable instr)ment has been gi+en to sec)re the payment of any boo2 debts of a company% the deposit of the instr)ment for the p)rpose of sec)ring an ad+ance to the company shall no for the p)rposes of this section be treated as a mortgage or charge on those boo2 debts; and i+" the holding of debent)res entitling the holder to a charge on immo+able property shall not be deemed to be an interest in immo+able property. (" Where any mortgage or charge on any property of a company re8)ire to be registered )nder this section has been so registered% any person ac8)iring s)ch property or any part thereof or any share or interest therein% shall be deemed to ha+e notice of the said mortgage or charge as from the date of s)ch registration.

?B

16%. e4ist(ation of cha(4e on p(ope(ties acAui(ed sub>ect to cha(4e. # !" Where a company registered in 6angladesh ac8)ires any property which is s)b.ect to a charge on any s)ch 2ind as wo)ld% if it had been created by the company% after the ac8)isition of the property% ha+e been re8)ired to be registered )nder this 1art% the company shall co)se the prescribed partic)lars of the charge together with a copy certified in the prescribed manner to be a correct copy of the instr)ment% if any% by which the charge was created or its e+idenced% to be deli+ered to the Registrar for registration in manner re8)ired by this Act within twenty/one days after the date on which the ac8)isition completed 1ro+ided that if the 1roperty is sit)ated and the charge was created o)tside 6angladesh the said twenty/one days shall be co)nted by excl)ding the period which wo)ld be necessary to recei+e the instr)ment in 6angladesh in d)e co)rse of post had it been despatched with d)e diligence. (" If a company defa)lts in complying with the pro+isions of this section the company and also e+ery officer of the company% who is 2nowingly and willf)lly in defa)lt% shall be liable to a fine not exceding one tho)sand ta2a. 161. Pa(ticula(s in case of se(ies of debentu(es entitlin4 holde(s pa(i passu. # !" Where a series of debent)res containing% or gi+ing by reference to any other instr)ment% any charge to the benefit of which the debent)res. holders of that series are entitled pari pass) is created by a company% it shall be s)fficient for the compliance of section !3& if there are filed with the Registrar with twenty/one days after the exec)tion of the deed containing the charge or% if there is no s)ch deed% after the exec)tion of any debent)res of the series% the following :/ a" the total amo)nt sec)red by the whole series; b" the dates of the resol)tions a)thorising the iss)e of the series and the date of the co+ering deed% if any% by which the sec)rity is created or defined; c" a general description of the property charged; d" the names of the tr)stees% if any% from the debent)re/holders; and e" the deed or a copy thereof +arified in the prescribed manner containing the charge or if there is no s)ch deed one of the debent)res of the series ; 1ro+ided that% where more than one iss)e is made of debent)res in the series% there shall be filed with the Registrar for entry in the register partic)lars of the date and amo)nt of each iss)e% b) an omission to do this shall no affect the +alidity of the debent)res iss)ed. (" #he Registrar shall register the partic)lars and the deeds filed )nder s)b section !". 16.. Pa(ticula(s in case of commission, etc. on debentu(es### Where any commission% allowance or disco)nt has been paid or made either directly or indirectly by the company to any person in consideration of his s)bscribing of agreeing to s)bscribe% whether absol)tely or conditionally% for any debent)res of the company% or for proc)ring or agreeing to proc)re s)bscriptions% whether absol)tely or conditionally for any s)ch debent)res% the partic)lars re8)ired to be filed for registration )nder section !3& and !>! shall incl)de partic)lars as to the amo)nt or rate percent of the commission% disco)nt or allowance so paid or made% b)t an ommission to do this shall not affect this +alidity of the debent)res iss)ed : 1ro+ided that the deposit of any debent)res as sec)rity for any debt of the company shall not for the p)rposes of this pro+ision be treated as the iss)e of debent)res at a disco)nt.

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160. e4iste(s of mo(t4a4es and cha(4es.### !" #he registrar shall 2eep% with respect to each company% a register in the prescribed form of all mortgages and charges created by the company after the commencement of this Act and re8)iring registration )nder section !3& and shall% on payment of the prescribed fee% enter in the register% with respect to e+ery s)ch mortgage or charge% the date of creation% the amo)nt sec)red by it% short partic)lars of the property mortgaged or charged and the names of the mortages or the persons entitled to the charge. (" After ma2ing the entry re8)ired by s)b/section !" the Registrar shall ret)rn the instr)ment% if any% or the +erified copy thereof% as the case may be% filed in accordance with the pro+isions of section !3& or !>! to the person filling the same. 9" #he register 2ept in p)rs)ance of this section shall be open to inspection by any person on payment of the fee% as specified in Sched)le II. 164. *nde3 to (e4iste( of mo(t4a4es and cha(4es.### #he Registrar shall 2eep a chronological index% in the prescribed form and with the prescribed partic)lars of the mortgages and charges registered with him )nder this Act. 16&. Ce(tificate of (e4ist(ation.####he Registrar shall gi+e a certificate )nder his hand of the registration of any mortgage or charge registered in p)rs)ance of section !3&% stating the amo)nt thereby sec)red% and the certificate shall be concl)si+e e+idence that the re8)irement of sections !3& to !>9 as to registration ha+e been complied with. 166. +ndo(sement of ce(tificate of (e4ist(ation on debentu(es o( ce(tificate of debentu(e# stoc<.## #he company shall ca)se a copy of e+ery certificate of registration% gi+en )nder section !>3 to be endorsed on e+ery debent)re or certificate of debent)re/stoc2 which is iss)ed by the company% and the payment of which is sec)red by the mortgage or charge so registere : 1ro+ided that nothing in this section shall be constr)ed as re8)iring a company to ca)se a certificate of registration of any mortaged or charge so gi+en to be endoresed on any debent)re or certificate of debent)re/stoc2 iss)ed by the company before the mortgage or charge was created. 16". /uty of company and (i4ht of inte(ested pa(ty as (e4a(ds (e4ist(ation ### !" E+ery company to file with the Registrar for registration the prescribed partic)lars of e+ery mortgage or charge created by the company and of the iss)es of debent)res of a series% re8)iring registration )nder section !3&% and registration of any s)ch mortgage or charge may be also effected on the application of any person interested therein. (" Where the registration is effected on the application of some person other than the company% that person shall be entitled to reco+er from the company the amo)nt of any fees properly paid by him to the Registar on the registration. 9" Whene+er the terms of conditions or extent or operation of any mortgage or charge registered )nder this section are modified% it shall be the d)ty of the company to send to the Registrar the partic)lars of s)ch modification and the pro+isions of this section as to registration of the mortgage or charge shall apply to s)ch modification of the mortgage or charge as aforesaid. 168. Copy of inst(ument c(eatin4 mo(t4a4e o( cha(4e to be <ept at (e4iste(ed office. // E+ery company shall ca)se a copy of e+ery instr)ment creating any mortgage or charge re8)iring registration )nder section !3& to be 2ept at the registered office of the company;

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1ro+ided that% in the case of a series of )niform debent)res% a copy of one s)ch debent)re shall be s)fficient. 169. e4ist(ation of appointment o( (ecei9e(# !" I any person obtains an order for the appointment of a recei+er of the property of a company% or appoints s)ch a recei+er )nder any powers contained in any instr)ment% he shall within fifteen days from the date of the order or of the appointment )nder the powers contained in the instr)ment% file notice of the fact with the Registrar and the Registrar% shall on payment of the prescribed fee% enter the fact in the register of mortgages and charges. (" If any person ma2es defa)lt in complying with the re8)irements of this section% he shall be liable to a fine not exceeding two h)ndred ta2a for e+eryday d)ring which the defa)lt contin)es. 1"%. 7illin4 of accounts of ecei9e(s# !" A recei+er referred to in section !>& of any property who had ta2en possession shall for e+ery financial year d)ring s)ch possession and also on ceasing to act as recei+er% file with the Registrar an abstract in the prescri+ed from of his receipts and payment d)ring the period to which the abstract relates and shall also% on ceasing to act as recei+er% file with the Registrar% notice to that effect and the Registrar shall inter the notice in the register of mortgages and charges. (" Where a recei+er of the property of a company has been appointed% e+ery in+oice% order for goods% or b)siness letter iss)ed by or on behalf of the company% or the recei+er of the company% being a doc)ment on or in which the name of the company appears% shall contain a statement that a recei+er has been appointed. 9" :or e+ery defa)lt in complying with the re8)irements of this section% the company% and also e+ery officer of recei+er as the case may be of the company% who 2nowingly and willf)lly a)thorises or permits the defa)lt% shall be liable to a fine not exceeding fi+e h)ndred ta2a. 1"1. ectification of (e4iste( of mo(t4a4es # !" If the $o)rt satisfied that/ a" the omission to register a mortgage or charge within the time re8)ired by section !3&% or the omission or mis/statement of any partic)lar with respect to any s)ch mortgage or charge% or the omission to gi+e intimation to the Registrar of the payment or satisfaction of a debt from which the mortgage or charge was created% was accidental or d)e to inad+ertence or to some other s)fficient ca)se% or b" the omission is not of a nat)re to pre.)dice the position of creditors or share/holders of the company% or c" on other gro)nds it is .)st and e8)itable to grant to relief the co)rt may% on the application of the company or any person interested and on s)ch terms and conditions as seem to the co)rt .)st and expedient% order that the time for registration be extended or% as the case may be% that the omission or mis/statement be rectified% and may ma2e s)ch order as to the costs to be paid to the applicant as it thin2s fit. (" Where the $o)rt extends the time for the registration of mortgage% or charge% the order shall not pre.)dice any right% as ac8)ired in respect of the property concerned prior to the time when the mortgage% or charge is act)ally registered. 1".. e4ist(ation of Satisfaction of mo(t4a4es and cha(4es## !" #he company shall gi+e intimation to the Registrar of the payment of satisfaction of any mortgage or charge re8)ired to be

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registered )nder section !3& within twenty/one days from the date of the payment or satisfaction thereof. (" #he Registrar shall% on receipt on s)ch intimation% ca)se a notice to be sent to the mortgage% calling )pon him to show ca)se% within a time not exceeding fo)rteen days to be fixed by s)ch notice% why the payment or satisfaction of the charge or mortgage sho)ld not be recorded. 9" #he Registrar shall% if no ca)se is shown% order that a memorand)m of satisfaction he entered on the register and shall% if re8)ired% f)rnish the company with a copy thereof. '" Where ca)se is shown the Registrar shall record a note to the effect in the register% and shall inform the company that he has done so 1"0. Penalties## !" If any company ma2es defa)lt in filing with the Registrar for registration the partic)lars/ a" of any mortgage or charge created by the company% or b" of the payment or satisfaction of a debt in respect of which a mortgage or charge had been registered )nder section !3& or section !>B% or c" of the iss)e of debent)res of a series; re8)iring registration with the Registrar )nder the foregoing pro+ision of this Act% then )nless the registration had been effected on the application of some other person% the company% and also e+ery officer of the company or other person who is 2nowingly a party to the defa)lt% shall% on con+iction be liable to a fine not exceeding one tho)sand ta2a for e+eryday d)ring which the defa)lt contin)es. (" S)b.ect as aforesaid% if any company ma2es defa)lt in complying with any of the re8)irements of this Act as to the registration with the Registrar of any mortgage or charge created by the company% the company% and also e+ery officer of the company% who is 2nowingly and willf)lly a party to the defa)lt% shall% witho)t pre.)dice to any other liability% be liable on con+iction to a fine not exceeding two tho)sand ta2a. 9" If any person 2nowingly and willf)lly a)thorises or permits the deli+ery of any debent)re or certificate of debent)re/stoc2 re8)iring registration with the Registrar )nder the foregoing pro+isions of this Act the certificate of registration being endorsed )pon it as re8)ired by section !>>% he shall% witho)t pre.)dice to any other liability% be liable of con+iction to a fine not exceeding two tho)sand ta2a. 1"4. Company@s (e4iste( of mo(t4a4es5## !" E+ery company shall 2eep register of mortgages and enter therein all mortgage and charges specifically affecting property of the company and all floating charge on the )nder ta2ing or on any property of the company% gi+ing in each case a short description of the property mortgaged or charged the amo)nt of the mortgage or charge and% except in the case of sec)rities to bearer% the name of the mortgages of persons entitled thereto. (" If any director% manager or other officer of the company 2nowingly and willf)lly a)thorieses or permits the omission of any entry re8)ired to be made in p)rs)ance of this section% he shall be liable to a fine not exceeding two tho)sand ta2a. 1"&. i4ht to inspect copies of inst(uments c(eatin4 mo(t4a4es and cha(4es and company@s (e4iste( of mo(t4a4es 5# !" #he copies 2ept at the registered office of the company in p)rs)ance of section !>A or instr)ments creating any mortgage or charge re8)iring registration

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)nder this Act with the Registrar and register of mortagges 2ept in p)rs)ance of section !?'% shall 2ept be open at all reasonable times to the inspections of any creditor or member of the company witho)t fee% and the register of mortgages shall also be 2ept open to the inspection of any other person on payment of s)ch fee% not exceeding ten ta2a for each inspection% as the company may prescribe. (" If inspection of the said copies or register is ref)sed the company shall be liable to a fine not exceeding one h)ndred ta2a for the first day and to a f)rther fine not exceeding fifty ta2a for e+eryday d)ring which the ref)sal contin)es% and e+ery officer of the company% who 2nowingly a)thorises or permits the ref)sal% shall inc)r the li2e penalty% and in addition to the abo+e penalty% the $o)rt may be order compel an immediate inspection of the copies or register. 1"6. i4ht to inspect (esiste( of debentu(e#holde(s and to ha9e copies of t(ust deeds5 // !" A company shall 2eep open e+ery register of the debent)re holders for he inspection its debent)re/holders and share/ holders and e+ery s)ch holder may re8)ire a copy of the register or part thereof on payment of fees specified in Sched)le II: 1ro+ided that/ a" the register shall not be inspected d)ring s)ch period or periods not exceeding in the whole thirty days in any year% as may be specified in the articles; and b" s)b.ect to s)ch reasonable restrictions as may be imposed by the general meeting% the register shall be 2ept open for inspection for at least two ho)rs in a day d)ring the permissible period. (" A copy of any tr)st/deed for sec)ring any iss)e of debent)res shall be forwarded to e+ery holder of any s)ch debent)res at his re8)est on payment% in the case of a printed tr)st deed% of the s)m of ten ta2a or s)ch less s)m as may be fixed by the company% or where the tr)st/deed is not printed% the fees specified in sched)le/II. 9" If inspection is ref)sed or a copy is ref)sed or not forwarded% the company shall be liable to a fine not exceeding one h)ndred ta2a for the first and to a f)rther fine not exceeding fifty ta2a for e+ery day s)bse8)ently d)ring which the ref)sal contin)es% and e+ery officer of the company who 2nowingly a)thorises or permits the ref)sal shall inc)r the li2e penalty; and the $o)rt may be order compel an immediate inspection of the register. /ebentu(e and 7loatin4 Cha(4es 1"". Pe(petual debentu(es5# A conditions contained in any debent)re or in any deed for sec)ring any debent)res% whether iss)ed or exec)ted before or after the passing of this Act shall not be in+alid by reason only that thereby the debent)res are made irredeemable or redeemable only on the happening of a contingency% howe+er% remote% or on the expiration of a period howe+er long. 1"8. Po$e( to (e#issue (edeemed debentu(es in ce(tain cases5# !" Where either before or after the commencement of this Act% a company has redeemed any debent)re pre+io)sly iss)ed% the company shall ha+e right% and shall be deemed to ha+e had the right% to 2eep the debent)res ali+e for the p)rposes of re/iss)e% )nless/ a" the articles of the conditions of iss)e expressly otherwise pro+ides; or

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b" the debent)res ha+e ben redeemed in p)rs)ance of any obligation on the company so to do% not being an obligation enforceable only by the person to whom the redeemed debent)res were iss)ed or his assigns. (" In the exercise of the right )nder s)b/section !"% the company shall ha+e power% and shall be deemed always to ha+e power% to re/iss)e the debent)res either by re/iss)ing the same debent)res or by iss)ing other debent)res in their place. 9" @pon s)ch re/iss)e% the person entitled to the debent)res shall ha+e% and shall be deemed always to ha+e had% the same rights and priorities as if the debent)res had not pre+io)sly been iss)ed. '" Where with the ob.ect of 2eeping debent)res ali+e for the p)rpose of re/iss)e they ha+e% either before or after the commencement of this Act% been transferred to a nominee of the company% a transfer from that nominee shall be deemed to be a re/iss)e for the p)rposes of this section. 3" Where a company has% either before or after the commencement of this Act% deposited any of its debent)res to sec)re ad+ances from time to time on c)rrent acco)nt or otherwise% the debent)res shall not be deemed to ha+e been redeemed by reason only of the acco)nt of the company ha+ing ceased to be in debt whilst the debent)res remained so deposited. >" #he re/iss)e of a debent)re or the iss)e of another debent)re in its place )nder the power by this section gi+en to% or deemed to ha+e been possessed by a company% whether the re/iss)e or iss)e was made before or after the commencement of this Act% shall be treated as the iss)e of a new debent)re for the p)rposes of stamp d)ty% b)t its shall not be so treated for the p)rposes of any pro+ision limiting the amo)nt or n)mber of debent)res to be iss)ed: 1ro+ided that any person leading money on the sec)rity of a debent)re re/iss)ed )nder this section which appears to be d)ly stamped may gi+e the debent)re in e+idence in any proceedings for enforcing his sec)rity witho)t payment of the stamp/d)ty or any penalty in respect thereof% )nless he had notice or% b)t for his negligence% might ha+e disco+ered that the debent)re was not d)ly stamped% b)t in any s)ch case the company shall be liable to pay the proper stamp/d)ly and penalty. ?" 4othing in this section shall pre.)dice any power to iss)e debent)re in place of any debent)res paid off or otherwise satisfied or exting)ished% reser+ed to a company by its debent)res or the sec)rities for the same. 1"9. Specific pe(fo(mance of cont(act to subsc(ibe fo( debentu(es5# A contract with a company to ta2e )p and pay for any debent)res of the company may be enforced by a decree for specific performance. 18%. Payment of ce(tain debts out of assets sub>ect to floatin4 cha(4ed in p(io(ity to claims unde( the Cha(4e 5# !" Where either a recei+er is appointed on behalf of the holders of any debent)res of a company sec)red by a floating charge% or possession is ta2en by or on behalf of those debent)re/holder of any property comprised on or s)b.ect to the charge% then if the company is not the time in co)rse of being wo)nd )p% the debt% which in e+ery winding )p are )nder the pro+isions of 1art/E relating to preferential payments are to be paid in priority to all other debts% shall be paid forthwith o)t of nay assets coming to the hands of the recei+er or the other person ta2ing possession as aforesaid in priority to any claim for principal or interest in respect of the debent)res.

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(" #he periods of time mentioned in the said pro+isions of 1art/E shall be rec2oned from the date of the appointment of the recei+er of possession being ta2en as aforesaid% as the case may be. 9" Any payments made )nder this section shall be reco)ped% as far as may be% o)t of the assets of the company a+ailable for payment of general creditors. ;A,ANC+#S:++T, STAT+'+NTS, ;!!CS +TC. 181. ;oo<s to be <ept by company and penalty fo( not <eepin4 them5# !" E+ery company shall 2eep proper boo2s of acco)nt with respect to/ a" all s)ms of money recei+ed and expended by the company and the matters in respect of which the receipt and expendit)re ta2e place; b" all sales and p)rchases of goods by the company; c" the assets and liabilities of the company; and d" in the case of a company engaged in prod)ction% distrib)tion% mar2eting% transportation% processing% man)fact)ring% milling extraction and mining acti+ities% s)ch partic)lars relating to )tilisation of material% labo)r and other items of o+erhead cost. (" :or the p)rpose of s)b/section !"% proper boo2s of acco)nt shall not be deemed to be 2ept with respect to the matters specified therein if there are not 2ept s)ch boo2s as are necessary to gi+e a tr)e and fair +iew of the state of the affairs of the company and to explain its transactions. 9" #he boo2s of acco)nt shall be 2ept at the registered office of the company and shall at all times be open to inspection by directors d)ring b)siness ho)rs: 1ro+ided that all or any of the boo2s of acco)nt may% for a period not exceeding six months% be 2ept at s)ch other place in 6angladesh as the board of 5irectors may decide and when the board of 5irectors so decides% the company shall within se+en days of the decision% file with the Registrar a notice in writing gi+ing the f)ll address of that other place. '" where a company has a branch office% whether in or o)tside 6angladesh% the company shall be deemed to ha+e complied with the pro+isions of s)b/section !"% if proper boo2s of acco)nt relating to the transactions effected at the branch office are 2ept at that office and proper s)mmarised ret)rns% made )pto date at inter+als of not more than three months% are sent by the branch office to the company at its registered office or the other place referred to in s)b/section 9". 3" #he boo2s of acco)nt of e+ery company relating to a period of not less than twel+e years immediately preceeding the c)rrent year together with +o)chers rele+ant to any entry in s)ch boo2s of acco)nt shall be preser+ed in good order; 1ro+ided that in the case of a company incorporated less than twel+e years before the c)rrent year% the boo2s of acco)nt for the entire period preceeding the c)rrent year together with the +o)chers rele+ant to any entry in s)ch boo2s of acco)nt shall be so preser+ed. >" If any of the persons referred to in s)b/section ?" fails to ta2e all reasonable steps to sec)re compliance by the company with the re8)irements of this section% or has% by his own wilf)l act% been the ca)se of any defa)lt by the company there)nder% he shall% in respect of each offence% ??

be p)nishable with imprisonment for a term which may extend to six months or with which may extend to fi+e tho)sand ta2a or with both. ?" #he persons referred to in s)b/section >" are the following% namely:/ a" where the company has a managing agent% managing director exec)ti+e director% general manager or manager% s)ch managing agent% managing director% exec)ti+e director% general manager or manager and all officers b)t excl)ding the ban2ers% a)ditors and legal ad+isers; b" where s)ch managing agent is a firm% e+ery partner in the firm; c" where s)ch managing agent is a body corporate% e+ery director of s)ch body corporate; d" where the company has neither a managing agent nor managing director nor exec)ti+e director nor general manager nor manager% e+ery director of the company.

18.. *nspection of boo<s of account, etc. of companies 5# !" #he boo2s of acco)nt and other boo2s and papers of e+ery company shall be open to inspection d)ring b)siness ho)rs by the Registrar or by s)ch other *o+ernment officer as may be a)thorised by the *o+ernment in this behalf. (" It shall be the d)ty of e+ery director or other officer of the company to prod)ce to the person ma2ing inspection )nder s)b/section !"% in this section referred to the inspecting person% all s)ch boo2s of acco)nt and other boo2s and other papers of the company in his c)stody or control and to f)rnish him with any statement% information or explanation relating to the affairs of the company as the inspecting person my re8)ire of him within s)ch time and at s)ch place as he may specify. 9" it shall also be the d)ty of e+ery director and other officer of the company to gi+e to the inspecting person all assistance in connection with the inspection which the company may be reasonable expected to gi+e. '" #he inspecting person may% d)ring the co)rse of inspection/ i" ma2e or ca)se to be made copies of boo2s of acco)nt and other boo2s; and ii" place or ca)se to be placed any mar2s of identification thereon in to2en of the inspection ha+ing been made. 3" 4otwithstanding anything contained in any other law for the time being in force or any contract to the contrary% inspecting person shall ha+e the same powers as are Eested in a ci+il co)rt )nder the $ode of $i+il 1roced)re% !&BA Act E of !&BA"% While trying a s)it% in respect of the following matters% namely:/ i" the disco+ery and prod)ction of boo2s of acco)nt and other doc)ments% at s)ch place and s)ch time as may be specified by s)ch person; ii" s)mmoning and enforcing the attendance of persons and examining them on oath:

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iii" inspection of any boo2s% registers and other doc)ments of the company at any place. >" Where an inspection of the boo2s of acco)nt and other boo2s and papers of the company has been made )nder this section% the inspecting person shall ma2e a report to the *o+ernment. ?" #he inspecting person )nder this section shall ha+e all the powers that a Registrar has )nder his Act in relation to the ma2ing in8)iries. A" If defa)lt is made in complying with the pro+isions of this section e+ery officer of the company who is in defa)lt shall be p)nishable with imprisonment for a term not exceeding one year and also with a fi+e not exceeding ten tho)sand ta2a. &" Where a director or anyother officer of a company has ben con+icted of any offence )nder this section% he shall% and from the date on which he is so con+icted% be deemed to ha+e +oated his office as s)ch and on s)ch +acation of office he shall be dis8)alified for holding s)ch office in any company for a period of fi+e years from s)ch date. 180. Annual balance sheet5# !" #he 6oard of 5irectors of e+ery company shall% at e+ery ann)al general meeting held in p)rs)ances of section A!% lay before the company a balance sheet together with the profit and loss acco)nt or in the case of a company not trading for profit. an income and expendit)re acco)nt for the period specified in s)b/ section (" of this section. (" #he said profit and loss acco)nt or the income and expendit)re acco)nt shall be prepared for the flowing period% namely:/ a" in the case of the first ann)al general meeting for the period beginning with the date of incorporation of the company and ending on a date which is within nine months preceding the date of the meeting; and b" in the case of any s)bse8)ent ann)al general meeting% for the period beginning with the date immediately after last acco)nt and ending on a date which is/ i" a date within none months preceeding s)ch meeting; or ii" in the case of a company carrying or b)siness or ha+ing interest o)tside 6angladesh% a date within twel+e months preceding the date of s)ch meeting; or iii" in a case where and extension of time has been granted for holding the meeting )nder section A!% a date within the said nine or twel+e months% as the case may be% preceding the date of holding s)ch meeting )nder that section. 1ro+ided that date the Registrar may% on an application being made to less before the expiry of the said nine or twel+e months% extend the period by a period not exceeding three months. 9" #he balance sheet and the profit and loss acco)nt or income and acco)nt shall be ca)sed to be a)dited by the a)ditor of the company as in this Act pro+ided and the a)ditor7s report shall be attached thereto or there shall be inserted at the foot thereof a reference to the report and the report shall be read before the company in general meeting and shall be person to inspection by any member of the company. '" #he period to which the acco)nt aforesaid relates is referred to in this Act as a Ifinancial year0 and it may be less or more than a calendar year% b)t shall not exceed fifteen months:

?&

1ro+ided that it may extend to eighteen months where special permission had been granted in that behalf by the Registrar. 3" If any person% being a director of a company% defa)lts in ta2ing all reasonable to comply with the pro+ision of this section% then he shall% in respect of each s)ch offence% be p)nishable with fine with may extend to fi+e tho)sand ta2a. >" #here shall be 2ept at the registered office of the company a copy of the balance sheet incl)ding profit and loss acco)nt or income and expendit)re% as the case may be% and the director7s report for inspection of the members and other categories of persons as are entitled thereto for a period of at least fo)rteen days before the general meeting of the company. 184. ;oa(ds (epo(t 5# !" #here shall be attached to e+ery balance sheet laid before a company in general meeting a report by its 6oard of 5irectors% with respect to/ a" the state of the company7s affairs; b" the amo)nt% if any% which the 6oard proposes to carry to any res+ere in s)ch balance sheet; c" the amo)nt% if any% which the 6oard recommends sho)ld be paid by way of di+idend; d" material changes and commitments% if any% affecting the financial position of the company which ha+e occ)rred between the end of the financial year of the company to which the balance sheet related and the date of the report. (" #he 6oard7s report shall% so far as is material for the appreciation of the state of company7s affairs by its members% deal with any changes which ha+e occ)rred d)ring the financial years :/ a" in the nat)re of the company7s b)siness; b" in the company7s s)bsidiaries or in the nat)re of the b)siness carried on by them; and c" generally in the classes of b)siness in which the company has an interest. 9" #he 6oard shall also be bo)nd to gi+e the f)llest information and explanations in its report aforesaid on e+ery reser+ation% 8)alification or ad+erse remar2 contained in the a)ditor7s report. '" #he 6oard report and any addend)m thereto shall be signed by its $hairman if he is a)thorised in that behalf by the 6oard% and where he is not so a)thorised J% shall be signed by s)ch n)mber of director as are re8)ired to sign the balance sheet and the profit and loss acco)nt or the income and expendit)re acco)nt% of the company by +irt)e of s)b/section !" and (" of section !A&. 3" If any person% being a director of a company% fails to ta2e all reasonable steps to comply with the pro+ision of s)b/section !" to 9" or being the chairman% signs the 6oards report otherwise than in conformity with the pro+isions of s)b/section '"% he shall% in respect of each offence% be liable to fine which may extend to fi+e tho)sand a2a. 18&. 7o(m and contents of balance sheet and p(ofit and loss accounts 5# !" #he balance sheet of a company shall contain a s)mmary of the property and assets and of the capital and lilabilities of the company. gi+ing a tr)e and fair +iew of affairs as at the end of the financial year% and it shall% s)b.ect to the pro+isions of this section be in the forms set o)t in 1art/I of Sched)le I. or as near thereto as circ)mstance admit or in s)ch other form as may be appro+ed by the

AB

*o+ernment either generally or in any partic)lar case; and in preparing the balance sheet d)e regard shall be had% as far as may be% to the general instr)ctions for preparation of balance sheet )nder the heading 04otes0 at the end of the 1art: 1ro+ide that nothing contained in this s)b/section shall apply to any ins)rance or ban2ing company or any company engaged in the generation or s)pply of electricity or to any other class of company for which a form of balance sheet has been specified in or )nder the law go+erning s)ch class of company. (" E+ery profit and loss acco)nt of a company shall ga+e a tr)e and fair +iew of the profit and or loss of the company for the financial year and shall% s)b.ect as aforesaid% comply with the re8)irements of 1art II of Sched)le DI so far as applicable thereto: 1ro+ided that nothing contained in this s)b/section shall apply to any ins)rance cor ban2ing company or any company engaged in the generation or s)pply of electricity or to any other class of company for which a form of profit and loss acco)nt had been specified in or )nder the law go+erning s)ch class of company. 9" #he *o+ernment may% by notification the official *a-ette% example any class of companies from the re8)irements of Sched)le DI if% in its opinion% it necessary to grant the exemption in the p)blic interest; and any s)ch exemption may be granted either )nconditionally or s)b.ect of s)ch conditions as may be spec2ified in the notification. '" #he *o+ernment may% on the application or with the consent of the 6oard of 5irectors of the company% by order% modify in relation to that company of the re8)irement of this Act as to the matters to be stated in the balance/sheet or profit and loss acco)nt for the p)rpose of adopting them to the circ)mstances of the company; 3" #he balance sheet and the profit and loss acco)nt of a company shall not be treated as not disclosing a tr)e and fair +iew of the state of affairs of the company merely be reason of the fact that they do not disclose/ i" in the case of an ins)rance company% any matters which are not re8)ired to be disclosed by the Ins)rance Act% !&9A IE of !&9A"; ii" in the case of a ban2ing company% any matters which are not re8)ired to be disclosed by the iii" in the case of a company engaged in the generation or s)pply of electrify% any matters which are not re8)ired to be disclosed by the Electricity Act% !&!B ID of !&!B"; i+" in the case of a company go+erned by any other law for the time being inf force% any matters which are not re8)ire to be disclosed by s)ch law; +" in the case of any company% any matters which are not re8)ired to be disclosed by +irt)e of the pro+isions contained in Sched)le DI or by +irt)e of the notification iss)ed )nder s)b/section 9" or an order iss)ed )nder s)b/section '". >" :or the p)rposes of this section% except where the context otherwise re8)ires any reference to balances/sheet or to profit and loss acco)nt shall incl)de any notes hereon or doc)ments annexed thereto% gi+ing information re8)ired by this Act and allowed by this Act to be gi+en in the form of s)ch noted or doc)ments.

A!

?" If any s)ch person as is referred to in s)b/section ?" of section !A! fails to ta2e all reasonable steps to sec)re compliance by the company% as regards any acco)nts laid before the company in general meeting% with this section and with the other re8)irements of this Act as to in the acco)nts% he shall% in respect of each offence% be p)nishable with imprisonment for a term which may extend to six months or with fine which may extend to fi+e tho)sand ta2a or with both: 1ro+ided that no person shall be sentenced to imprisonment for any s)ch offence )nless it was committed willf)lly. 186. ;alance sheet of holdin4 company to include ce(tain pa(ticula(s as to its subsidia(ies 5# !" #here shall be attached to the balance sheet of a holding company ha+ing a s)bsidiary or s)bsidiaries as the end of the financial year as at which the holding company7s balance sheet is made o)t% the following doc)ments in respect of s)ch s)bsidiary or each s)ch s)bsidiary% as the case may be/ a" a copy of the balance sheet of the s)bsidiary; b" a copy of the its profit and loss acco)nt; c" a copy of the report of its 6oard of 5irectors; d" a copy of the report of its a)ditors; e" a statement of the holding company7s interest in the s)bsidiary as specified in s)b/ section >"; f" the statement referred to in s)b/section AB% if any; and g" the report referred to in s)b/section &"% if any. (" #he balance sheet referred to in cla)se a" of s)b/section !" shall be made o)t in accordance with the re8)irement of this Act as at the end of the financial year of the s)bsidiary next before the day as at which the holding company7s balance sheet is made o)t. 9" #he profit and loss acco)nt and the reports of the 6oard of directors and of the a)ditors referred to in cla)se b"% c" and d" of s)bsection !" shall be made o)t in accordance with the re8)irements of this Act for the financial year of the s)bsidiary referred to in s)b/section (". '" the financial year aforesaid of the s)bsidiary shall not end on a day which the holding company7s financial year ends by more than six months. 3" Where the financial year of s)bsidiary is shorter in d)ration than that of its holding company% reference to the financial year of the s)bsidiary in s)b/sections ("% 9" and '" shall be constr)ed as reference to two or more financial years of the s)bsidiary the d)ration of which% in the aggregate is not less than the d)ration of the holding company7s financial year. >" #he statement referred to in cla)se e" of s)b/section !" shall specify/ a" #he extent of the holding company7s interest in the s)bsidiary at the end of the financial year or at the end of the last of the financial years of the s)bsidiary;

A(

b" the net aggregate amo)nt% so far as it concerns members of the holding company and is not dealt with in the company7s acco)nts% of the s)bsidiary profits after ded)cting its losses or +ice/ +ersa/ i" for the financial year or years of the s)bsidiary as aforesaid; and ii" for the pre+io)s financial years of he s)bsidiary since it became the holding company7s s)bsidiary; c" the nest aggregate amo)nt of the profits of the s)bsidiary after ded)cting its losses or +ice/ +ersa/ i" for the financial year or years of the s)bsidiary as aforesaid; and ii" for the pre+io)s financial years of the s)bsidiary since it become the holding company7s s)bsidiary; so far as those profits are dealt with% or pro+ision is made for those losses% in the company7s acco)nts. ?" $la)ses b" and c" of s)b/section >" shall apply only to profits and losses of the s)bsidiary which may properly be treated in the holding company7s acco)nts as re+en)e profits or losses; and profits or losses attrib)table to any other of its s)bsidiaries shall not% for that or any other p)rpose% be treated as aforesaid so far as they are profits or losses for the period before the date of or as from which the shares were ac8)ired by the company or any of its s)bsidiaries% except that they may in a proper case be so treated where/ a" the holding company is itself he s)bsidiary of another body corporate; and b" the shares were ac8)ires from that body corporate or a s)bsidiary of this. +3planation5/ :or the p)rpose of determining whether any profits or losses are to be treated as profits or losses for the said period% the profits or loss for any financial year of the s)bsidiary may% if it isn7t practicable to apportion it with reasonable acc)racy by reference to the facts% be treated as accr)ing from day to day d)ring that year and be apportioned accordingly. A" Where the financial year or years of a s)bsidiary referred to ins)b/section 3"" do not coincide with the financial year of the holding company% a statement containing information on the followingmaters had also to be attached to the balance sheet of the holding company:/ a" whether there had been any changes and% if so what change too2 place in the holding company7s interest in the s)bsidiary between the end of the financial year or of the last of the financial years of the s)bsidiary and the end of the holding company7s financial year; b" details of any material change% which ha+e occ)rred between the end of the financial year or of the last of the financial years of the s)bsidiary and the end of the holding company7s financial year in respect of/ i" the s)bsidiary7s fixed asset; ii" its in+estments; iii" the moneys borrowed by its for nay p)rpose other than that of meeting c)red liabilities. A9

&" If% for any reason% the 6oard of 5irectors of the holding company is )nable to obtain information of any of the matters re8)ires to be specified by s)b/secion ?"% a report in writing to that effect shall be attached to the balance sheet of the holding company. !B" #he doc)ment referred to in cla)se e"% f" and g" of s)b/ section !" shall be signed by the persons by whom the balance sheet of the holding company is re8)ired to be signed. !!" #he *o+ernment may on the application or with the consent of the 6oard of 5irectors of the $ompany% direct that in relation to any s)bsidiary% the pro+isions of this section shall not apply% or shall apply only to s)ch extent as may be specified in the direction. !(" If nay s)ch person as is referred to in s)b/section ?B of section !A! fails to ta2e all reasonable steps to comply with the pro+isions of this section% he shall% in respect of each offence% be p)nishable with imprisonment for a terms which may extend to six months% or with fine which may extent to one tho)sand ta2a% or with both: 1ro+ided that in any proceedings against any person in respect of an offence )nder this section% it shall be a defence to pro+e that a competent and reliable person was charged with the d)ty of seeing that the pro+isions of this section were complied with and that he was in a position to discharge that d)ty: 1ro+ided f)rther that no person shall be sentenced to imprisonment for any s)ch offence )nless it was committed willf)lly. 18". 7inancial yea( of holdin4 company and subsidia(y5# !" Where it appears to the *o+ernment that it is desirable for a holding company or a holding company7s s)bsidiary to extent its financial year so that the s)bsidiary7s financial year many end with that of the holding company% and for that p)rpose to postpone the s)bmission of the rele+ant acco)nt to a general meeting% the *o+ernment may% on the application or with the consort of the 6oard of 5irectors of the company whose financial year is to be extended% director that in the case of that company% the s)bmission of acco)nts to a general meeting% the holding of a general meeting or the ma2ing of an ann)al ret)rn% shall not be re8)ired to be s)bmitted or made earlier than the dates specified in the direction not with standing anything to the contrary in this Act or in any other law for the time being in force. (" #he *o+ernment shall% on the application of the 6oard of directors of a holding company or a holding company7s s)bsidiary% exercise the powers conferred on its by s)b/section !"% if it is necessary to doin order to sec)re that the end of the financial year of the s)bsidiary does not precede the end of holding company7s financial year by more than six months% where that is not the case at he commencement of his Act or at the date on which the relationship of holding company and s)bsidiary comes into existence where that date is later than the commencement of this Act. 188. i4ht of holdin4 company@s (ep(esentati9es and membe(5# !" A holding company may% by resol)tion a)thorise its representati+es named in the resol)tion to inspect the boo2s of acco)nt of any s)ch s)bsidiary shall be open to open to inspection by those representati+es at any time d)ring b)siness ho)rs. (" #he rights conferred by section !&3 )pon members of a company may be exercised% in respect of any s)bsidiary% by s)ch representati+e of the holding company as if they alone were members of the s)bsidiary.

A'

189. Authentication of balance sheet, p(ofit and loss account, etc5# !" Sa+e as pro+ided by s)b/section ("% e+ery balance sheet% and e+ery profit and loss acco)nt or income and expendit)re acco)nt shall be signed on behalf of the 6oard of 5irectors/ i" in the case of ban2ing company% by the manager% or managing agent% if nay% and% where there are more than three directors of the company% by at least three of those directors or% where there are not more than three directors% by all the directors; ii" in the case of any other company% by its managing agent% manager or secretary% if any% and by not less than two directors of the company one of whom shall be the managing director where there is one. (" When the total n)mber of directors of the company for the time being in 6angladesh is less than the n)mber of directors whose signat)res are re8)ired by s)b/section !"% then the balance sheet and profit and loss acco)nt or the income and expendit)re acco)nt shall be signed by all the directors for the time being in 6angladesh% or if there is only one director for the time being in 6angladesh% by s)ch director b)t in s)ch case% there shall be attached to the balance sheet% and the profit and loss acco)nt or the income and expendit)re acco)nt a statement signed by s)ch director or directors explaining the reason for non/compliance with the pro+isions of s)b/section !". 9" #he balance sheet and the profit and loss acco)nt or income and expendit)re acco)nt shall be appro+ed by the 6oard of 5irectors before they are signed on behalf of the 6oard in accordance with the pro+isions of this section and before they are s)bmitted to the a)ditors for their report thereon. '" If any copy of a balance sheet or profit and loss acco)nt or income and expendit)re acco)nt% which had not been signed as re8)ired by s)b/section !" and ("% it iss)ed% circ)lated or p)blished or if any copy of a balance sheet it iss)ed% circ)lated or p)blished with there being annexed or attached hereto% as the case may be% a copy of that acco)nt% any acco)nts% reports or statements which% by +irt)e of section !A> are re8)ired to be attached to the balance sheet% the a)ditors% report% and the 6oard7s report referred to in section !A3 or if any defa)lt is made in complying with other re8)irement of this section the company and e+ery office of the company who is in defa)lt% shall be p)nishable with imprisonment for a term which may extend to six months of with fine which may extend to two tho)sand ta2a or with both. 19%. Copy of balance#sheet, etc. to be filed $ith e4ist(a(5 !" After the balance sheet and profit and loss acco)nt or the income and expendit)re acco)nt% as the case may be% ha+e been laid before a company at an ann)al general meeting as aforesaid% there shall be filed with the Registrar% within thirty days from the date on which the balance sheet and the profit and loss acco)nts were so laid% or where the ann)al general meeting of a company for any year has not been held% there shall be filed with the Registrar within thirty days from the last day on which that meeting sho)ld ha+e been held in accordance with the pro+isions of this Act three copies of the balance/sheet% and of the profit and loss acco)nt or the income and expendit)re acco)nt% as the case may by signed by the managing director% managing agent% a manger or secretary of the company or if there be none of these% by a director of the company% together with three copies of all doc)ments which are re8)ired by this Act to be annexed or attached to s)ch balance/sheet or profit and loss acco)nt or income and expendit)re acco)nt: 1ro+ided that in the case of a pri+ate company% which is not an s)bsidiary of a p)blic company% no person other than a member of the company shall be entitled to inspect or to obtain copies of the profit and loss acco)nt of that company.

A3

(" If the ann)al general meeting of a company before which a balancesheet is laid as aforesaid does not adopt the balance/sheet or% if the ann)al general meeting of a company for any year has not been half% a statement of that fact and of the reasons therefor shall be annexed to the balance/sheet and to the copies thereof re8)ired to be file with the Registrar. 9" If a company ma2es defa)lt in complying with the re8)irements of this section% it shall be liable to a fine not exceeding one h)ndred ta2a for e+ery day d)ring which the defa)lt contin)es% and e+ery office of the company who 2nowingly and willf)lly a)thorises or permits the defa)lt shall be liable to the li2e penalty. 191. i4ht of membe(s to copies of account and (epo(t5# !" A copy e+ery balance sheet% incl)ding the profit and loss acco)nt% the a)ditors report or the income and expendit)re acco)nt and e+ery other doc)ment re8)ired by law to be annexed or attached% as the case may be% to the balance sheet which is to be laid before a company in general meeting shall% not less than fo)rteen days before the date the meeting% be sent free of charge% to e+ery member of the company% to e+ery holder of debent)res iss)ed by the company% not being debent)res which ex/ facie are payable to the bearer thereof% to e+ery tr)stee for the holders of any debent)res iss)ed by the company% whether s)ch member% holder or tr)stee is or is not entitled to ha+e notices of the general meeting of the company sent to him% and to all persons other than s)ch members% holders or tr)stees being persons so entitled: 1ro+ide that :/ a" in the case of a company not ha+ing a share capital% this s)bsection shall not re8)ire the sending of a copy of the doc)ment aforesaid to an member% or holder of debent)res% of the company who is not entitled to ha+e notices of general meetings of the company sent to him; b" this s)b/section shall not re8)ire a copy of the doc)ment aforesaid to be sent/ i" to a members% or holder of debent)res% of the company who is not entitled to ha+e notices of general meetings of the company sent to him and of show address the company is )naware; ii" to more than one of the .oint holders of any shares of debent)res none of whom is entitled to ha+e s)ch notices sent to him; or iii" in the case of .oint holders of any shares or debent)res some of whom are and some of show are not entitled% to ha+e s)ch notes sent to them% to those who are not entitled; and c" if the copies of the doc)ments aforesaid are sent less than fo)rteen days before the date of the meeting% they shall not withstanding that fact% be deemed to ha+e been d)ly sent to the members entitled to +ote at the meeting if they do not raise any ob.ection to s)ch sending. (" Any member or holder of debent)res of a company whether he is or is not entitled to ha+e copies of the company7s balance sheet sent to him% shall% on demand% be entitled to be f)rnish witho)t charge% and any person from whom the company had accepted a s)m of money by way of deposit shall% on demand accompanied by the payment of fee of ten ta2a% be entitled to be f)rnished with a copy of the last balance sheet of the company and of e+ery doc)ment re8)ired% by law to be annexed or attached thereto% incl)ding the profit and loss acco)nt and the a)ditor7s report and s)ch doc)ments shall be deli+ered to him within se+en days from s)ch demand.

A>

9" If defa)lt is made in complying with s)b/section !" and ("% the company% and% also e+ery officer of the company who is in defa)lt% shall be p)nishable with fine which may extend to fi+e h)ndred ta2a. '" If% when a person ma2es a demand for a copy or any doc)ment with which he is entitled to be f)rnished by +irt)e of s)b/section (" defa)lt is made in complying with the demand within se+en days after the ma2ing thereof% the company% and also e+ery officer of the company who is in defa)lt% shall be p)nishable with fine which may extend to fi+e h)ndred ta2a% )nless it is pro+ed that the person had already made a demand for and been f)rnished with copy of the doc)ment; and in case of s)ch defa)lt% the $o)rt% apart from imposing the penalty% may also% by order% direct that the copy demanded shall forthwith be f)rnished to the person concerned. 3" S)b/section !" to '" shall not apply in relation to a balance sheet of a pri+ate company laid before it before the commencement of this Act and in s)ch a case the right of any person to ha+e sent to him or to be f)rnished with a copy of the balance sheet% and the liability of the company in respect of a fail)re to satisfy that right% shall be the same as they wo)ld ha+e been if this Act be had not been passed. Statement to be published by ;an<in4 and ce(tain othe( companies5# 19.. Ce(tain companies to publish statement in schedule5# !" E+ery company being a limited 6an2ing company or an ins)rance company for a deposit% pro+ident or benefit society shall% before% it commences b)shiness% and also on the first Honday in :ebr)ary and the :irst Honday in A)g)st in e+ery year d)ring which it carries on b)siness ma2e a statement herein after referred to as the said statement in the form as in Sched)le DII% or as near thereto as circ)mstances will admit. (" A copy of the said statement together with a copy of the last a)dited balance sheet laid before the members of the company shall be displayed and% )ntil the display of the next following statement% 2ept displayed in a conspic)o)s place in the registered office of the company% and in e+ery branch office or place where the b)siness of the company is carried on. 9" E+ery member and e+ery creditor of the company shall be entitled to a copy of the s)m statement on payment of a s)m not exceeding fi+e ta2a. '" If a company ma2es defa)lt in complying with the re8)irements of this section% it shall be liable to a fine not exceeding one h)ndred ta2a for e+eryday d)ring which the defa)lt contin)es; and% also e+ery officer of the company who 2nowingly and willf)lly a)thorises or permits the defa)lt shall be liable to the li2e penalty. 3" #his section shall not apply to a life ins)rance company or pro+ident ins)rance society% to which the pro+isions of the Ins)rance Act% !&9A IE of !&9A"% or any other ins)rance law for the time being in force as to the ann)al statement to be made by s)ch company or society apply with or witho)t modification% if the company or society complies with those pro+isions. *n9esti4ation by the e4ist(a( 190. Po$e( of e4ist(a( to call fo( info(mation o( e3planation5 # !" Where the Registrar% on per)sal of any doc)ment which a company is re8)ired to s)bmit to him )nder the pro+ision of this Act% or on receipt of a written ob.ection against an s)ch doc)ments from any member of the company% is of opinion that any information explanation is necessary in order that s)ch doc)ment may afford f)ll partic)lars of the matter to which it p)rports to relate% he may% by a written order% call on the company to f)rnish in writing s)ch information or explanation or to prod)ce s)ch boo2s or papers% as may be re8)ired by him within s)ch time as he may specify in his order.

A?

(" ,n the receipt of an order )nder s)b/Section !"% it shall be the d)ty of all persons who are or ha+e been officer of the company to f)rnish s)ch information or explanation !" to the best of their power. 9" If an s)ch person ref)se or neglects to f)rnish any s)ch information or explanation% he shall be liable to a fine not exceeding fi+e h)ndred ta2e in respect of each offence and the $o)rt may% on the application of the Registrar and )pon notice to the company% ma2e an order on the company for prod)ction of s)ch doc)ment as in its opinion may reasonable be Re8)ired by the registrar for his in+estigation and allow the Registrar inspection thereof on s)ch terms and conditions as it thin2s fit. '" ,n receipt of s)ch information or explanation% the Registrar may annex the same to the original doc)ment s)bmitted to him and any additional doc)ment so annexed by the Registrar shall be s)b.ect to the li2e pro+isions as to inspection and the ta2ing of copies as the original doc)ments are s)b.ect. 3" If s)ch information or explanation or additional doc)ment is not f)rnished within the time specified by the $o)rt or the Registrar% or if after perFs)al of s)ch information or explanation or additional doc)ment; the Registrar is of opinion that the doc)ment in 8)estion discloses an )nsatisfactory state of affairs% or that it does not discloses an )nsatisfactory state of affairs% or that it does not disclose a f)ll% fair% and tr)e% statement of the matters to which it p)rports to relate% the Registrar may direct the company to correct the doc)ments in the manner directed by him or may report in writing the circ)mstances of the case to the go+ernment. >" If it is represented to the Registrar on materials placed before him by any member contrib)tory% creditor or any other person interested that the b)siness of a company is being carried on in fra)d of its member% creditors or persons dealing with the company or for a fra)d)lent p)rpose that the affairs of the company are not being managed in accordance with the pro+isions of this Act% he may after gi+ing the company an opport)nity of being hear% by a written order% call on the company for information or explanation on matters specified in the order or re8)ired the company to prod)ce any doc)ment with s)ch time as he may specify in the order and the pro+ision of s)b/section ("% 9" and 3" of this section shall apply to s)ch order. ?" If )pon in+estigation% the Registrar is satisfied that any representation on which he had ta2en action )nder s)b/section >" is false% fri+olo)s or +exatio)s% he shall disclose the identify of the informant to the company. A" #he pro+isions of this section shall apply m)tatis m)tatis to doc)ments which a li8)idator is re8)ire to file )nder this Act. 194. SeiDu(e of document by e4ist(a( 5# !" Where )pon any information% the Registrar has reasonable gro)nd to belie+e that boo2s and papers of or relating to and company or other body corporate or any managing agent or managing director or manager of s)ch company or other body corporate% or any associate of s)ch managing agent or managing director or manager may be destroyed% m)tilated% falsified or secreted the Registrar may ma2e an application to the Hagistrate of the first class ha+e .)risdiction for an order for the sei-)re of s)ch boo2s and papers. (" After considering the application and hearing the Register. if necessary% the Hagistrate may% be order% a)thorise the Registrar/ a" to enter% with s)ch assistance as may be re8)ired% the place or places where s)ch boo2s and papers are 2ept;

AA

b" to search that places or those place in the manner specified the order; c" to sei-e s)ch boo2s and papers as he considers necessary. 9" #he Registrar shall ret)rn the boo2s and papers sei-ed )nder this cection as soon as may be% and in any case not later than the thirtieth day% after s)ch sei-)re% to the company% or the other body corporate% or as the case may be% to the managing agent or the associate of s)ch managing agent or managing director or the manager or the associate of s)ch managing agent or managing director or manager or any other person% from whose c)stody or power they were sei-ed% and shall inform the Hagistrate of s)ch ret)rn: 1ro+ided that the Registrar may% before ret)rning s)ch boo2s and papers as aforesaid% ta2e copies of% or extracts from% them or place indemnification mar2s on them or any part thereof or ideal with them in s)ch other manner as he considers necessary. '" Sa+e as otherwise pro+ided in this section% e+ery search or sei-)re made )nder this section shall be carried o)t in accordance with the pro+ision of the $ode of $riminal 1roced)re% !A&A Act E of !A&A" relating to search or sei-)re% made )nder that $ode. *nspection and Audit 19&. *n9esti4ation of affai(s of company by inspecto(s5# #he *o+ernment may appoint one or more competent inspectors to in+estigate the affairs of any company and to report thereon in s)ch manner as the *o+ernment may direct/ a" in the case of a company ha+ing a share capital% on the application of members holding not less than one/tenth of the shares iss)es; b" in the case of a company not ha+ing a share capital% on the application of not less than one/ fifty in n)mber of the person on the company is register of members; c" in the case of any other company% on a report by the Registrar )ndersection !&9 3". 196. Application fo( inspection to be suppo(ted by e9idence 5# An application by members of a company )nder section !&3 shall be s)pported by s)ch e+idence as the *o+ernment may re8)ire for the p)rpose of showing that the applicants ha+e good re8)iring for re8)iring the in+estigation; and the *o+ernment may also% before appointing an inspector% re8)ire the applicants to gi+e sec)rity for payment of the costs of the in8)iry. 19". *nspection of boo<s and e3amination of office(s5# Witho)t pre.)dice to its powers )nder section !&3% the *o+ernment/ a" shall appoint one or more competent persons as inspectors to in+estigate the affairs of a company and to report thereon in s)ch manner as the *o+ernment may direct% if the company% by a special resol)tion or% the $o)rt% by an order% declares that the affairs of the company o)ght to be in+estigated by an inspector/appointed by the *o+ernment; and b" may do so if% in the opinion of the *o+ernment% there are circ)mstances s)ggesting/ i" that the b)siness of the company is being cond)cted with intent to defra)d its creditors% members any other persons% or otherwise for a fra)d)lent or )nlawf)l p)rpose% or in a manner oppressi+e of any of its members% or that the company was formed for any fra)d)lent or )nlawf)l p)rpose; or

A&

ii" that persons concerned in the formation of the company or the management of its affairs ha+e in connection therewith been g)ilty of fra)d% misfeasance or other miscond)ct toward the company or towards may of its members; or iii" that the members of the company ha+e not been gi+en all the informations with respect to its affairs which they might reasonable expect. 198. 7i(m, body co(po(ate o( association not to be appointed inspect 5# 4o firm% body corporate or other association shall be appointed an inspector )nder section !&3 or section !&?. 199. Po$e(s of inspecto(s to ca((y in9esti4ation into affai(s of (elated companies o( of mana4in4 a4ent o( associate 5# !" If any inspector appointed )nder section !&3 or !&? to in+estigate the affairs of a company thin2s it necessary% for the p)rposes of his in+estigation% to in+estigate also the affairs of/ a" any other body corporate which is% or was at any rele+ant time the company7s s)bsidiary or holding company7s or a s)bsidiary of its holding company% of a holding company% of its s)bsidiary. b" an other body corporate which is to has at any rele+ant time been managed/ i" by any person as managing agent% or as managing director or as manager% who is% or was at the rele+ant time% either the managing agent or the managing director or the manager of the company: or ii" by any person who is or was at the rele+ant time as associate of the managing agent; or iii" by any person of whom the managing agent is% or was at the rele+ant time% as associate; or c" any other body corporate which is% or was at any rele+ant time% managed by the company or whose 6oard of 5irector comprises of nominees of the company or is acc)stomed to act in accordance with the direction of/ i" the company% or ii" any of the directors of the company% or iii" any company whose directorship is held by the employee of nominees of those ha+ing the control and management of the first mentioned company; or d" any person% who is% or was at any rele+ant time% the company7s managing agent% managing director or manager of an associate of s)ch managing agent% then the inspector shall% s)b.ect to the pro+ision of s)b/section ("% ha+e power to in+estigate and shall report on the affairs of the other body copperplate% the managing agent% managing director% manager or associate of the managing agent% as for as he thin2s that the res)lt of his in+estigating thereof are rele+ant to the in+estigation of the affairs of the first/mentioned company. (" In the case of any body corporate or person referred to in cla)se b" ii" iii"% c" or d" of s)b/ section !"% the inspector shall not exercise his affairs witho)t first ha+ing obtained the prior appro+al of the go+ernment thereto:

&B

1ro+ided that before according appro+al )nder this s)b/section% the *o+ernment shall gi+e the body corporate or persons a reasonable opport)nity to show ca)se as to why s)ch appro+al shall not be accorded. .%%. P(oduction documents and e9idence 5# !" It shall be the d)ty of all officers and employees and agents of the company% and where the company is or was managed by a managing agent% and where the affairs of any other body corporate or of a managing agent or of an associate of a managing agent are in+estigated by +irt)e of section !&&% of all officers and employees and agents of s)ch body corporate% managing agent or associate% and where s)ch managing gent or associate is or was a firm of all partners in the firm/ a" to preser+e and to prod)ce to the inspector or any person a)thorised by him in this behalf with the pre+io)s appro+al of the go+ernment% all boo2s and papers of% or relating to% the company or% as the case may be% of or relating to the other body corporate% managing agent or associate which are in their c)stody or powers; and b" otherwise to gi+e to the inspector all assistance in connection with the in+estigation which they are reasonably able to gi+e. (" #he inspector may% with the pre+io)s appro+al of the *o+ernment% re8)ire anybody corporate other than a body corporate referred to in s)b/section !" to f)rnish s)ch information% or prod)ce s)ch boo2% and papers before% him or any person a)thorised by him in this behalf with the pre+io)s appro+al of the *o+ernment as he may consider necessary% if the f)rnishing of s)ch information or the prod)ction of s)ch boo2s and papers is rele+ant or necessary for the p)rposes of his in+estigation. 9" #he inspector may 2eep in his c)stody any boo2s and papers prod)ced )nder s)b/section !" or (" for six months and thereafter shall ret)rn the same to the company% body corporate% firm or indi+id)al by whom or on whose behalf the boo2s and papers are prod)ced: 1ro+ided that the inspector may again call for the boo2s and papers if they are needed again: 1ro+ided f)rther that if certified copies of the boo2s and papers prod)ced )nder s)b/section ("% are f)rnished to the inspector% he shall ret)rn those boo2s; and papers to the body corporate concerned. '" An inspector may examine on oath any of the persons referred to in s)b/section !" or with the pre+io)s appro+al of the *o+ernment% any other person% in relation to the affairs of the company% other body corporate% managing agent or associate% as the case may be% and may administration oath accordingly and for that p)rpose may re8)ire any of those persons to appear before him personally. 3" If any person fails witho)t reasonably ca)se or ref)ses/ a" to prod)ce to an inspector or an person a)thorise by him in this behalf with the pre+io)s appro+al of the *o+ernment any boo2s or paper which it is his d)ty )nder s)b/ section !"" or (" to prod)ce; or b" to f)rnish any information which it is d)ty )nder s)b/section (" to f)rnish; or c" to appear before the inspector personally when re8)ired to do so )nder s)b/section '" or to answer any 8)estion which is p)t to him by the inspector in p)rs)ance of that s)b/section ; or

&!

d" to sign the notes of any examination referred to in s)b/section >"% he shall be p)nishable white imprisonment for a terms which may extend to six months% or with fine which may extend to fi+e tho)sand ta2e% or with both% and also with a f)rther fine which may extend to fi+e h)ndred ta2e for e+ery day after the first d)ring which the fail)re or ref)sal contin)es. >" 4otes of any examination )nder s)b/section '" shall be ta2en down in writing and shall be read e+er to% or by% and signed by% the person examined% and may thereafter be )sed in e+idence against him. ?" In this section/ a" the expression 0officers0 in relation to any company or other body corporate% incl)ded any tr)stee for the debent)re holders s)ch of company or body corporate; b" the expression 0agent0 in relation to any company% other body corporate or person% means% any one acting or p)rporting to act for or on behalf of s)ch company% body corporate or person% and incl)des the ban2ers% and legal ad+isers of% and persons employed as a)ditors by s)ch company% body corporate or person; and c" any reference to officers and employees% agent or partners shall be constr)ed as a reference to past as well as present officers and other employees% agent or partners% as the case may be. .%1. SeiDu(e of document by inspecto(s5# !" Where in the co)rse of in+estigation )nder section !&3 or section !&?% the inspector has reasonable gro)nd to belie+e that the boo2s and papers of% or relating to% any company or other body corporate or any managing agent or managing director or manager of s)ch managing agent may be distorted% m)tilated% altered% falsified or secreted the inspector may ma2e an application to the Hagistrate of the :irst $lass ha+ing .)risdiction for an order for the sei-)re of s)ch boo2s and papers. (" After considering the application and hearing the inspector% if necessary% the Hagistrate may be order a)thorise the inspector/ a" to enter% with s)ch assistance as may be re8)ired% the place or places where s)ch boo2s and papers are 2ept; b" to search that place or those places in the manager specified in the order; and c" to sei-e boo2s and papers he considers necessary for p)rposes of his in+estigation. 9" #he inspector may 2eep in his c)stody the boo2s and papers sei-ed )nder this section for s)ch period not later than the concl)sion of the in+estigation as he considers necessary and thereafter shall ret)rn the same to the company or the other body corporate or% as the case may be% to the managing agent or the associate of s)ch managing agent or the managing director or the manager or any other person from whose c)stody or power they were si-ed and shall inform the Hagistrate of s)ch ret)rn: 1ro+ided the the inspector may% before ret)rning s)ch boo2s and papers as aforesaid% place identification ma2es on them or any part thereof.

&(

'" Sa+e as otherwise pro+ided in this section% e+ery search or sei-e made )nder this section shall be carried o)t in accordance with the pro+ision of the $ode of $riminal 1roced)re% !A&A Act% E of !A&A" relating to search of sei-)re made )nder the $ode. .%.. *nspecto(@s (epo(t 5# !" Inspectors may% and if so directed by the *o+ernment shall% ma2e interim reports to the *o+ernment% and on the concl)sion of the in+estigation% shall ma2e a final report to the *o+ernment; and any s)ch report shall be written or printed% of the *o+ernment may direct. (" #he *o+ernment/ a" shall forward a copy of the final report to the company at its registered office% and also to any other body% corporate% managing agent% or associate if dealt with in the report by +irt)e of section !&&; b" may% if it thin2s% fit f)rnish a copy thereof% on re8)est and on payment of the prescribed fee% to any person i" who is a member of the company or other body corporate incl)ding a managing agent or associate of a managing agent where s)ch managing agent or associate is a body corporate dealt with in the report by +irt)e of section !&&; ii" who si a partner in the firm where s)ch managing agent or associate is a firm; iii" whose interest as a creditor of the company% other body corporate% managing agent or associate aforesaid appears to the *o+ernment to be affected; c" shall% where the inspectors are appointed )nder cla)se a" or b" of section !&3% f)rnish at the re8)est of the applicants for the in+estigation a copy of the report of them; d" shall% where the inspectors are appointed )nder cla)se a" of section !&? in p)rs)ance of and order of the $o)rt% f)rnish a copy of the report to the $o)rt; and e" may also ca)se the report to be p)blished. .%0. P(osecution# !" If% from any report made )nder section (B( it appears to the *o+ernment that any person has% in relation to the company or in relation to any other body corporate% managing agent% or associate of other body corporate% managing agent% or associate of a managing agent whose affairs ha+e been in+estigated by +irt)e of section !&&. been g)ilty of any offence for which he is criminally liable% the *o+ernment may prosect)re s)ch person for the offence; and It shall be the d)ty of all officer and employees and agents of the company% body corporate% managing agent or associate% as the case may be% other than the acc)sed in the proceedings% to gi+e the *o+ernment all assistance in connection with the prosec)tion which they are reasonably able to gi+e. (" S)bsection ?" of section (BB shall apply for the p)rpose of this section as it applies for the p)rposes of that section. .%4. Application fo( $indin4 up of company o( an o(de( in that behalf# if any s)ch company or other body corporate or any s)ch managing gaent% or associate% being body corporate% as is mentioned in section !&&% is liable to be wo)nd )p )nder this Act% and it appears to the

&9

*o+ernment from any s)ch report as aforesaid that it is expedient so to do by reasons of any crrc)mstances as are referred to in s)b/ cla)se i" or ii" of cla)se b" of section !&?% the *o+ernment may% )nless the company% body corporate% managing agent or associate is already being wo)nd )p by the $o)rt% ca)se to be presented to the $o)rt by the Registrar; a" a petition for the winding )p of the company% body corporate% managing agent% or associate on the gro)nd that it is .)st and e8)itable that it sho)ld be wo)nd )p; b" an application for an order )nder section (99; c" both a petition and an application as aforesaid. .%&. P(oceedin4s fo( (eco9e(y of dama4es o( p(ope(ty# !" If from any report made )nder section (B! it appears to the *o+ernment that proceedings o)ght% in the p)blic interest% to be bro)ght by the ompany or anybody corporate whose affairs ha+e been in+ested in p)rs)ance of cla)se a"% b" or c" of section !&&. a" for the reco+ery of damages in repeat of any fra)d% misfeasance or other miscond)ct in connection with the promotion or formation% or the management of the asairs% or s)ch company of body corporate; or b" for the necessary of any property of s)ch company% or body corporate% which has been misapplied or wrongf)lly retained: the *o+ernment may itself bring preceding for s)ch p)rpose in the name of s)ch company or body corporate. (" #he *o+ernment shall indemnify s)ch company or body corporate against any costs or expencess inc)rred by it in% or in connection with any proceedings bro)ght by +irt)e s)b/section !"% if s)ch proceedings is fo)nd to be fri+olo)s. .%6. +3penses of in9esti4ation # !" #he expenses of and incidental to an in+esgatin by an inspector appointed by the *o+ernment )nder section !&3 or !&? shall be defrayed in the first instance by the *o+ernment; b)t the following persons shall% to the extent mentioned below% be liable to reimb)rse the *o+ernment in respect of expenses of s)ch in+estigation :/ a" any persons who is con+icted on a prosec)tion instit)ted in p)rs)ance of section (B9% and who is ordered to pay damages or restore any property in the proceedings bro)ght by +irt)e of section (B3% may% in the some proceedings be ordered to pay the said expenses to s)ch extent as may be specified by the co)rt con+icting s)ch person% or ordering him to pay s)ch damages or restore s)ch property% as the case may be; b" in any company or body corporate in whose name proceedings are bro)ght )nder section (B3 !" shall be liable to pay the cost of the in+estigation b)t not exceeding the amo)nt or +al)e of any some or property reco+ered by it as a res)lt of the proceedings; and c" )nless% as a res)lt of the in+estigation% a prosec)tion is instit)ted in p)rs)ance of section (B9/ i" any company% body corporate% managing agent% associate% managing director or manager dealt with by report of the inspector shall be liable to reimb)rse the go+ernment in respect of the whole expenses% )nless and except in so far as the *o+ernment otherwise directs; and

&'

ii" the application for the in+estigation% where the inspector was appointed )nder cla)se b" of s)b/section i" shall be a first charge on the s)ms or property mentioned in that cla)se. 9" #he amo)nt of expenses in respect of which any company% body corporate% managing agent% associate% managing director or manager is liable )nder s)b/cla)se i" of cla)se c" of s)b/section !" to reimb)rse the *o+ernment% shall be reco+erable from that company% body corporate% managing agent% associate% managing director or manager% as2 an arrears of land re+en)e. '" for the p)rposes of this section% any costs or expenses inc)rredely the *o+ernment in or in connection with proceedings bro)ght by +irt)e section (B3 incl)ding expenses inc)rred by +iFt)re of s)b/section (" thereof shall be treated as expenses of the in+estigation gi+ing rise to the proceedings. 3" Any liability to reimb)rse the *o+ernment imposed by cla)se a" and b" of s)b/section !" shall% s)b.ect to satisfaction of the right of the *o+ernment to reimb)rsement% be a liability also to indemnify all persons against liability )nder cla)se c" of that s)b/section. >" Any s)ch liability imposed by cla)se a" of s)bsection !" shall% s)b.ect to the right of the *o+ernment as to reimb)rsement% be a liability also to indemnify all persons against liability )nder cla)se b" of the said s)b/section. ?" Any person liable )nder the cla)se a" or b" or c" of s)b/ section !" shall be entitled to contrib)tion from any other persons liable )nder the same cla)se or claises as the case may be% according to the amo)nt of their respecti+e liabilities there)nder. A" In so far as the expenses to be defrayed by the *o+ernment )nder this section are not reco+ered there)nder% they shall be paid o)t of moneys pro+ided by 1arliament. .%". Po$e( of company to appoint inspecto(s# !" A company may% by a special resol)tion% appoint inspectors to in+estigate its affairs. (" Inspectors so appointed shall ha+e the same powers and d)ties as inspectors appointed by the *o+ernment% except that% instead of reporting to the go+ernment% they shall report in s)ch manner and to s)ch persons as the company in general meeting may direct. 9" All persons who are or were officers of the company shall inc)r the penalties in case of ref)sal to prod)ce any boo2 or doc)ment re8)ired to be prod)ced to inspectors so appointed% or to answer any 8)estion% as they wo)ld ha+e inc)rred if the inspectors had been appointed by the *o+ernment. .%8. epo(t of the inspecto(s to be e9idence.# a copy of the report of any inspector appointed )nder this Act a)thenticated by the seal of a company whose affairs they ha+e in+estigated% shall be admissible in any legal proceeding as e+idence of the opinion of the inspector in relation to any matter contained in the report. .%9. Sa9in4 fo( le4al ad9ise( and ban<e(s# 4othing in section !&9 to (B> shall re8)ire the disclos)re to the Registrar or to the *o+ernment or to any inspector appointed by the *o+ernment/ a" by a legal ad+iser% of any pri+ileged comm)nication made to him in that capacity% except as respect the name and address of his client; or

&3

b" by the ban2ers of any company% other body corporate% managing agents% or associate of he managing agent or managing director or manager referred to in the sections aforesaid% as s)ch ban2ers of any information as to the affairs of any of there c)stomers. .1%. Appointment and (emune(ation of audito(s# !" E+ery company shall% at each ann)al general meeting appoint an a)ditor or a)ditors to hold office from the concl)sion of that meeting )ntil the next ann)al general meeting and shall within se+en days of the appointment% gi+e intimation thereof to e+ery a)ditor so appointed: 1ro+ided that no person can be appointed a)ditor of any company )nless his written consent has been obtained prior to s)ch appointment or re/appointment. (" E+ery a)ditor appointed )nder s)b/section !" shall% within thirty days of the receipt from the company of the intimation of hi appointment% inform the Registrar in writing that he has accepted% or ref)sed to accept% the appointment. 9" At any ann)al general meeting a retiring a)ditor% by whatsoe+er a)thority appointed% shall be reappointed% )nless/ a" he is not 8)alified for re/appointment; or b" he has gi+en the company notice in writings of his )nwillingness to be re/appointed; or c" a resol)tion has been passed at that meeting appointing somebody else instead of him or pro+iding expressly that he shall not be re/appointed: 1ro+ided that for the p)rpose of passing a resol)tion )nder cla)se c"% a notice thereof shall in accordance with section (!! be iss)ed prior to the meeting% and s)ch resol)tion cannot be passed except on the gro)nd of death% incapacity or dishonesty of dis8)alification of the retiring a)ditor% '" if an appointment of an a)ditor is not made at an ann)al general meeting% the *o+ernment may appoint a person to fill the +acancy. 3" #he company shall% within se+en days of the *o+ernments power )nder s)b/section '" becoming exercisable% gi+e notice of that fact to the *o+ernment; and% if a company fails to gi+e s)ch notice% the company% and also e+ery officer of the company who is in defa)lt% shall be p)nishable with fine which may extent to one tho)sand ta2e. >" #he first a)ditor or a)ditors of a company shall be appointed by the 6oard of 5irectors within one months of the date of Registration of the company% and the a)ditor or a)ditors so appointed shall hold office )ntil the concl)sion of the first ann)al general meeting: 1ro+ided that/ a" the company may% at a general meeting remo+e any s)ch a)ditor or all or any of s)ch a)ditors and appoint in his or their place any other persons or persons who ha+e been nominated for appointment by any member of the company% and or whose nomination notice has been gi+en to the members of the company not less than fo)rteen days before the date of the meeting: and b" if the 6oard of 5irectors fails to exercise its powers )nder this s)b/section% the company in a general meeting% may appoint the first a)ditor or a)ditors.

&>

?" #he 6oard may fill any cas)al +acancy is the office of any a)ditor% b)t while any s)ch +acancy contin)es% the remaining a)ditor or a)ditors% if any% many act: A" Any a)ditor appointed in a ca)sal +acancy shall hold office )ntil the concl)sion of the next ann)al general metting. &" Except as pro+ided in the process p)rs)ant to s)b/section ?"% any a)ditor appointed )nder his section may be remo+ed from office before the expire of his term only by a special resol)tion of the company in the general meeting. !B" the rem)neration of the a)ditors of a company/ a" in the case of an a)ditor appointed by the 6oard or the *o+ernment% shall be fixed by the 6oard or the *o+ernment respecti+ely : and b" s)b.ect to cla)se a"% shall be fixed by the company in the general meting or in s)ch manner as the company in the general meeting may determine. !!" for the p)rposes of s)b/section !B"% any s)ms paid by the company in respect of the a)ditors expenses shall be deemed to be incl)ded in the expression 0rem)neration0. .11. P(o9isions as to (esolutions fo( appointin4 o( (emo9in4 audito(s5# !" Special notice shall be re8)ired for a resol)tion at an ann)al general meeting appointing as a)ditor a person other than a retiring a)ditor% or pro+iding expressly that a retiring a)ditor shall not be re/ appointed. (" ,n receipt of s)ch notice the company shall forthwith send a copy thereof to the retirning a)ditor% 9" Where s)ch notice is gi+en and the retiring a)ditor ma2es with respect thereto representation in writing to the company and re8)ests their notification to members of the company% the company shall% )nless the representation are recei+ed by it too late for it to do so/ a" in any notice of the resol)tion gi+en to members of the company% state the fact of the representation ha+ing been made; and b" send a copy of the representation to e+ery member of the company to whom notice of the meeting is sent% whether before or after the receipt of the representation by the company% and if a copy of the representation% is not sent as aforesaid beca)se the were recei+ed too late or beca)se of the company defa)lt% the a)ditor may% witho)t pre.)dice to his right to be heard orally% re8)ire that the representation shall be read o)t at the meeting. 1ro+ided that copies of the representation need not be sent o)t and the representations need not be read o)t at the meeting if% on the application either of the company or of any other person who claims to be aggrie+ed% the co)rt is satisfied that the rights conferred by this s)b/section are being ab)sed to sec)re needless p)blicity for defamatory matter; and the $o)rt may order the company7s costs on s)ch an application to be paid whole or in part by the a)ditor% notwithstanding that he is not a party to the application. '" s)b/section (" and 9" shall apply to a resol)tion to remo+e the first a)ditors or any of them )nder s)b/section >" of section (!B or to the remo+al or any a)ditor or a)ditors )nder s)b/

&?

section A" of that section% as they apply in relation to are sol)tion that a retiring a)ditor shall not be re/appointed. .1.. Bualification and disAualification of audito(s5# !" 4o persons shall be appointed an a)ditor of any company )nless he is a 0chartered acco)ntant0 within the meaning of the 6angladesh $hartered Acco)ntants ,rder% !&?9% 1.,. 4o. ( of !&?9": 1ro+ided that a firm whereof all the partners practising in 6angladesh are 8)alified for appointment as aforesaid may be appointed by its firm name to be a)ditor of company in which case any of the a)ditors so practising may act in the name of the firs. (" 4one of the following persons shall be 8)alified for appointment as a)ditor of a company namely/ a" an officer or employee of the company; b" a person who is partner% or who is in the employment of an officer or employee of the company; c" a person who is indebted to the company for an amo)nt exceeding one tho)sand ta2a% or who had gi+en any g)arantee or pro+ided any sec)rity in connection with the indebtedness of any third person to the company for an amo)nt exceeding one tho)sand ta2a: d" a person who is director or member of a partner company% or a partner of a firm% which is the managing agent of the company; e" a person who is a director% or the holder of shares exceeding fi+e percent in nominal +al)e of the s)bscribed capital% of any body corporate which is the managing agent of the company. 1ro+ided that where any shares held by a person as nominee or tr)stee for any third person and in which the holder has no beneficial interest s)ch shares shall be excl)ded in comp)ting the extent of the s)bscribed capital for the p)rpose of this cla)se. +3planation 5# :or the p)rposes of this s)b/section the word 0officer0 or 0employee0 shall not in incl)de an a)ditors. 9" A person shall not be 8)alified for appointment as an a)ditor of a company% if/ a" he% according to s)b/section ("B% is dis8)alified for appointment as a)ditor of any other body corporate which is that company7s s)bsidiary or holding company or a s)bsidiary of that company7s holding company7s; b" he wo)ld be dis8)alified for s)ch appointment% had the said body corporate been a company. '" If an a)ditor becomes s)b.ect% after his appointment to any of the dis8)alification7s specified in s)b/section (" and 9"% he shall be deemed to ha+e +acated his office as s)ch. .10. Po$e( and duties of audito(s5# !" E+ery a)ditor of a company shall ha+e a right of access at all times to the boo2s and acco)nts and +o)chers of the company% whether 2ept at the head office of the company or elsewhere and shall be entitled to re8)ire from the officers of the &A

company s)ch information and explanation as the a)ditor may thin2 necessary for the performance of his d)ties as a)ditor. (" Witho)t pre.)dice to the pro+isions of s)b/section !"% the a)ditor shall% in partic)lar in8)ire into following namely:/ a" Whether loans and ad+ances made by the company on the basis of sec)rity ha+e been properly sec)red and whether the terms on which they ha+e been made are not pre.)dicial to the interests of the company or its members: b" Whether transactions of the company which are represented merely as boo2/entries are pre.)dicial to the interests of the company; c" where the company is not an in+estment company or a ban2ing company% whether so m)ch of the assets of the company as consist of shares% debent)res and other see)rities% ha+e been sold at a price less than at which they were p)rchased by the company; d" whether loans and ad+ances made by the company ha+e been shown as deposits; e" whether personal expenses ha+e been charged to re+en)e acco)nt; f" where it is stated in the boo2s and paper of the company that any shares ha+e ben allotted for cash% whether cash has act)ally been recei+ed in respect of s)ch allotment% and if no cash has act)ally been so recei+ed% whether the position as stated in the acco)nt boo2s and the balance sheet is correct% reg)lar and not misleading. 9" #he a)ditor shall ma2e a report to be presented in the ann)al general meeting of he company on the acco)nts% examined by him% and on e+ery balance sheet and profit and loss acco)nt and on e+ery other doc)ment declared by this Act to be part of or annexed to the balance sheet or profit and loss acco)nts which are laid before the company in general meeting d)ring his ten)re of office and the report shall state whether% in his opinion and to the best of his information and according to the explanation gi+en to him% the said acco)nts gi+e the information re8)ired by this Act in the manner so re8)ired and gi+e a tr)e and fair +iew/ a" in the case of the balance sheet% of the state of the company7s affairs as at the end of its financial year; b" in the case of the profit and loss acco)nt% of the profit or loss for its financial year. '" #he a)ditors report shall also state/ a" whether he has obtained all the information and explanation which to the best of his 2nowledge and belief were necessary for the p)rposes of his a)dit; b" whether% in his opinion% proper boo2s of acco)nt as re8)ired by law ha+e been 2ept by the company so far as appears from his examination of those boo2s and proper ret)rns ade8)ate for the p)rposes of his a)dit ha+e been recei+ed from branches not +isited by him; c" whether the company7s balance sheet and profit and loss acco)nt dealt with by the report are in agreement with the boo2s of acco)nt and ret)rns. 3" #here any of the matters referred to in cla)ses a" and b" of s)b/ section 9" or in cla)ses a"% b" and c" of s)b/section '" are answered in the negati+e or with a 8)alification% the a)ditoris report shall state the reason for the answer.

&&

>" #he *o+ernment may% be general or special order% direct that in the case of s)ch class or description of companies as may be specified in the order% the a)ditors report shall also incl)de a statement on s)ch matters as may be specified therein. ?" #he acco)nts of a company shall not be deemed as not ha+ing been and the a)ditors reportt shall not state that those acco)nts ha+e not been% properly drawn )p on the gro)nd merely that the company has not disclosed certain matters% of/ a" those matters are s)ch as the company is not re8)ired to disclose by +irt)e of any pro+ision contained in this Act or any other law for the time being in force; and b" those pro+isions are specified in the balance sheet and loss acco)nt of the company. .14. Audit of accounts of b(anch office of company5# !" Where a company has a branch office% the acco)nts of that office shall% be a)dited by the company7s a)ditors at their option% or where the branch office is sit)ated in a co)ntry o)tside 6angladesh% the acco)nts of the office shall be a)dited either by the company7s a)ditor or by a person d)ly 8)alified to act as an a)ditor of the acco)nts of the branch office in accordance with the laws of that co)ntry% if so decided by the shareholders in a general meeting. (" Where the acco)nts of any branch office are a)dited by a person other than the company7s a)ditor% the company7s a)ditor/ a" shall be entitled to +isit the branch office% if he deems it necessary to do so for the performance of his d)ties as a)ditor; and b" shall ha+e a right of access at all times to be boo2s and acco)nts and +o)chers of the company maintained at the branch office; 1ro+ided that in the case of a ban2ing company ha+ing a branch office o)tside 6angladesh% is shall be s)fficient if the a)ditor is allowed access to s)ch copies of% and extracts from the boo2s and acco)nts of the branch as ha+e been transmitted to the principal office of the company in 6angladesh. .1&. Si4natu(e of audit (epo(t, etc5# ,nly the person appointed as a)ditor of the company% or where a firm is so appointed in p)rs)ance of the pro+iso to s)b/section !" of section (!(% only a partner in the firm practising in 6angladesh shall p)t his signat)re on the a)ditor7s report% or any other doc)ment re8)ired of the company by law to be signed or a)thenticated by the a)ditor. .16. eadin4 and inspection of audito(@s (epo(t5# #he a)ditors report shall be read before the company in general meeting and shall be open to inspection by any member of the company. .1". i4ht of audito( to attend 4ene(al meetin4# All notices of an other comm)nications relating to any general meeting of a company which any member of the company is entitled to ha+e sent to him shall also be forwarded to the a)ditor of the company% and the a)ditor shall be entitled to attend any general meeting and to be heard at any general meeting which he attends on any part of the b)siness which concerns him as a)ditor. .18. Penalty fo( non#compliance $ith section .11 to .1"# If defa)lt is made by a company in compalying with any of the pro+isions contained in section (!! to (!?% the company% and also e+ery officer of the company who is in defa)lt% shall be p)nishable with fine with which may extend to one tho)sand ta2a.

!BB

.19. Penalty fo( non#compliance by audito( $ith section .10 and .1&.# If any a)ditors report is made or any doc)ment of the company is signed or a)thenticated otherwise than in conformity with the re8)irement of sections (9! (!3% the a)ditor concerned% and any other person% who signs the report or signs or a)thenticates the doc)ment% shall if the defa)lt is wilf)l% be p)nishable with fine which may extend to one tho)sand ta2a. ..%. Audit of ce(tain matte(s by Cost and 'ana4ement Accountants.# !" where in the opinion of the *o+ernment% it is necessary to do in relation to any company re8)ired )nder cla)se/ d" of s)b/section !" of section !A! to incl)de in its boo2s of acco)nts the partic)lar referred to therein the *o+ernment may% by order% direct that an a)dit of cost acco)nts of the company shall be cond)cted in s)ch manner as may be specified in the order by an a)ditor who shall be a $ost and management acco)ntant0 within the meaning of the $ost and Hanagement Acco)nts ,rdinance% !&?? C III of !&??". (" An a)dit cond)cted by an a)ditor )nder this section shall be in addition to an a)dit cond)cted by an a)ditor appointed )nder section (!B. 9" #he pro+isions relating to a)dit of a company specified in this Act m)tatis m)tandis% and so far as they are applicable% apply to an a)dit cond)cted )nder this section. ..1. i4ht of p(efe(ence sha(eholde(s and debentu(e holde(s as to (eceipts and inspection of (epo(ts, etc5# !" Holders of preference shares debent)re holders of a company shall ha+e the same right to recei+e and inspect the balance sheets and profit and loss acco)nt of the company and the reports of the a)ditors and other reports as is possessed by the holders of ordinary shares in the company. (" #his section shall not apply to a pri+ate company% nor to a company registered before the commencement of this Act:/ 1ro+ided that in the case of any p)blic company whether registered before on after the commencement of this Act% the tr)stees for holders of debent)res shall ha+e the right conferred s)b/section !". Ca((yin4 on business $ith less than the le4al minimum of membe(s. .... ,iability fo( ca((yin4 on business $ith fe$e( than se9en o(, in the case of a p(i9ate company, t$o membe(s5# If at any time the n)mber of members of a company is red)ced% in the case of a pri+ate company% below two or% in the case of any other company% below se+en and it carries on b)siness for more than six mo)ths% while the n)mber is so red)ced e+ery person who is a member of the company d)ring the time that it so carries or b)siness d)ring that periods and is cognisant of the fact that it is carrying on b)siness with fewer than two members or se+en members% as the case may be% shall be indi+id)ally liable for the payment of the whole debts of the company contracted d)ring that time and may be )sed for the same witho)t .oinder in the s)it of any other member. Se(9ice and Authentication of /ocuments ..0. Se(9ice of documents on company5# A doc)ment may be ser+ed on a company by lea+ing it at% or sending it by post to% the registered office of the company. ..4. Se(9ice of documents of e4ist(a(5# A doc)ment may be ser+ed on the Registrar by sending it to him by post% or deli+ering it to him% or by lea+ing it for him% at his office.

!B!

..&. Authentication of documents5# A doc)ment or proceeding re8)iring a)thentication by a company may be signed by a director% secretary or other a)thorsied officer of the company% and need not be )nder its common seal. Schedules and ules as to p(esc(ibed matte(s ..6. Application and alte(ation of schedules and po$e( to ma<e (ules as to p(esc(ibed matte(s5# !" #he forms specified in Sched)les EI to DII or forms as near thereto as circ)mstances admit shall be )sed in all matters to which those forms refer. (" #he *o+ernment may alter any of the Sched)les except Sched)le II 9" Any alteration made )nder s)b/section (" shall be p)blished in the official *a-ette and on s)ch p)blication the Sched)les so altered shall ha+e effect as if enacted in this Act% b)t no alteration made by the *o+ernment in Sched)le I% shall affect any company registered before the alteration as respects that company or any portion of that Sched)le. '" In addition to the powers herein before conferred by this section% the *o+ernment may ma2e r)les pro+iding for all or any maters which by this Act are to be prescribed by its a)thority. 3" E+ery s)ch r)le shall be p)blished in the official *a-ette% and on s)ch p)blication shall ha+e effect as if enacted in this Act. A(bit(ation and Comp(omise ..". Po$e( of companies to (efe( matte(s to a(bit(ation.# !" A company may by written agreement% refer to arbitration% in accordance with the arbitration act% !&'B D of !&'B"% on existing or f)t)re difference between itself and any other company or person. (" $ompanies may delegate to the arbitrator power to settle any terms or to determine any matter capable of being lawf)lly settled or determined by the companies themsel+es% or by their director or other managing body. 9" #he pro+ision of the Arbitration Act% !&'B D of !&'B"% shall apply to all arbitration7s between companies and persons in p)rs)ance of this Act. ..8. Po$e( to comp(omise $ith c(edito(s and membe(s.# !" Where a compromise or arrangement is proposed between the company and its members or any class of them% the $o)rt may% on the application in s)mmary way of the company or of any creditor or member of the company or% in the case of a company being wo)nd )p% of the li8)idator% order a meeting of the creditors or class of creditors% or the members of the company or class of members% as the case may be% to be called% held and cond)cted in s)ch manner as the $o)rt directs. (" If a ma.ority in m)mber representing three/fo)rths in +al)e of creditors% or of members as the case may be% present either in person or by proxy at the meeting% agree to any compromise or arrangement% the compromise or arrangement shall if sanctioned by the $o)rt be binding on all the creditors or the class of creditors% on or all the members or class of members% as the case may be% and also on the company% in the case of a company in the co)rse of being wo)nd )p% on the li8)idator and contrib)tories of the company. 9" An order made )nder s)b/section (" shall ha+e no effect )ntil a certified copy of the order has been filed with the Registrar% and copy of e+ery s)ch order shall be annexed to e+ery copy of the memorand)m of the company iss)ed after the order has been made% or in the case of a company

!B(

not ha+ing a memorand)m% of e+ery copy so iss)ed of the instr)ment constit)ting or defining the constit)tion of the company. '" If a company ma2es defa)lt in complying with s)b/section 9"% the company and also e+ery officer of the company% who is 2nowingly and willf)lly in defa)lt% shlall be liable to a fine not exceeding fifty ta2e for each copy in respect of which the defa)lt is made. 3" #he $o)rt may% at anytime after an application has been made to it )nder this section% stay the commencement or contin)ation of any s)it or proceeding against a company on s)ch terms as it thin2s fit and proper )ntil the application is finally disposed of. >" In this section% her expression 0company0 means any company liable to be wo)nd )p )nder this Act and the expression 0arrangement0 incl)des a reorganisation of the share capital of the company by the consolidation of shares of different classes or by the di+ision of shares into shares of different classes or by both% those methods and% for the p)rposes of this section )nsec)red creditors who may ha+e filed s)its or obtained decrees shall be deemed to be of the same class as other )nsec)red creditors. ?" An appeal shall lie from any order made by the $o)rt exercising original .)risdiction )nder this section to the a)thority a)thorised to hear appeals from the decision of the $o)rt. ..9. P(o9isions fo( facilitatin4 a((an4ements and comp(omises.# !" Where an application is made to the $o)rt )nder section ((A for the sanctioning of a compromise or arrangement proposes between a company and any s)ch persons as are mentioned in that section% and it is shown to the co)rt that the compromise or arrangement has been proposed for the p)rposes of% or in connection with% a scheme for the reconstr)ction of any company or companies to the amalgamation of any two or more companies% and that )nder the scheme the whole or any part of the )nderta2ing and the property of any company concerned in the scheme% in this section referred to as a transferor company% is to be transferred to another company in this section referred to as the transferee company% the $o)rt may% either by the order sanctioning the compromise or arragemennt or by any s)b/se8)ent order% ma2e pro+ision for all or any of the following matters :/ a" the transfer to the transferee company of the whole or any part of the )nderta2ing and of the property or liabilities of any transferor company; b" the alloting or appropriation by the transferre company of shares% debent)res% policies% or other li2e interests in that company which )nder the compromise or arrangement are to be alloted or appropriated by that company to or for any person; c" the contin)ation by or against the transferee company of any legal proceedings pending by or against any transferor company; d" the dissol)tion% witho)t winding )p% of any transferor company; e" the pro+ision to be made for any person who% within s)ch time and in s)ch manner as the $o)rt directs% dissents from the compromise or arrangement; f" s)ch incidental% conse8)ential and s)pplemental matters as are necessary to sec)re that the reconstr)ction or amalgamation shall be f)lly and effecti+ely carried o)t. (" Where an order )nder this section pro+ides for the transfer of property or liabilities% that property shall be +irt)e of the order% be tranaferred to and +est in% and those liabilities shall be

!B9

+irt)e of the order transferred to and become the liabilities of the transferee company% and in the case of any property% if the order so directs% it shall be freed from any charge which is% by +irt)e of the compromise or arrangement or cease to ha+e effect. 9" Where an order is made )nder this section% e+ery company in relation to which the order is made shall ca)se a certified copy thereof to be deli+ered to the Registrar for registration within fo)rteen days after the completion of the order% and if% defa)lt is made in complying with the s)b/ section% the company and also e+ery officer of the company who is 2nowingly and wilf)lly in defa)lt% shall be liable to a fine not exceeding two h)ndred ta2a. '" In this section% the expression 0property0 incl)des property% rights and powers of e+ery description% and the expression 0liabilities0 incl)des d)ties. 3" 4otwithstanding the pro+isions of s)b/section >" of section ((A% the expression 0company0 in this section does not incl)de any company other than a company within the meaning of this Act. .0%. Po$e( to acAui(e sha(es of sha(eholde(s dissentin4 f(om schemes of cont(act app(o9ed by ma>o(ity5# !" Where/ a" a scheme or contract in+ol+es the transfer of shares or any class of shares in a company% in this section referred to as the transferor company% to another company% whether a company within the meaning of this Act or not% in this section referred to as the transferee company; and b" within one h)ndred and twenty days after the ma2ing of the offer in that behalf by the transferee company% the offer has been appro+es by the holders of not less than three/ fo)rths in +al)e of the shared affected% the transferee company may% at anytime within sixty days after the expiration of the said one h)ndred and twenty days% gi+e notice in the prescribed manner to any dissenting shareholder that it desires to ac8)ire his shares. (" Where s)ch a notice is gi+en )nder s)b/section !"% the transferee company shall )nless on an application made by the dissenting shareholder within thirty days from the date on which the notice was gi+en the $o)rt than2s fit to order otherwise; be entitled and bo)nd to ac8)ire those shares on the terms on which )nder the scheme or contract the shares of the appro+ing share holders are to be transferred to the transferee company. 9" Where a notice has been gi+en by the transferee company )nder s)b/ section !" and the $o)rt has not% on an application made by the dissenting shareholder% ordered to the contrary% the transferee company shall% on the expiration of one month from the date on which the notice has been gi+en% or% if an application to the $o)rt by the dissenting shareholder in then pending% after that application has been disposed of transmit a copy of the notice to the transferor company and pay or transfer to the transferors company the amo)nt or other consideration representing the price payable by the transferee company for the shares which by +irt)re of this section that company is entitled to ac8)ire% and the transferor company shall there)pon register the transferee company as the holder of those shares. '" Any s)ms recei+ed by the transferor company )nder this section shall be paid in to a separate ban2 acco)nt and any s)ch s)ms and any other consideration so recei+ed shall be held by that company on tr)st for the se+eral persons entitled to the shares in respect of which the said s)ms or other consideration were respecti+ely recei+ed.

!B'

3" In this section% the expression 0dissenting shareholder0 incl)des a share holder who has not assented to the scheme or contract and any shareholder who has failed or ref)sed to transfer his shares to the transferee company in accordance with the scheme or contract. Con9e(sion of p(i9ate company into public company and 9ice#9e(sa .01. Con9e(sion of p(i9ate company into public company.## !" If a company being a pri+ate company ha+ing at least se+en members afters its articles in s)ch manner that they no longer incl)de the pro+isions which% )nder cla)se of s)b/section !" of section ( of this Act% are re8)ired to be incl)ded in the articles of a company in order to constit)te it a pri+ate company% the company/ a" shall as on the date of the alteration cease to be a pari+ate company; and b" shall within a period of this thirty days after the said date file with the Registrar either a prospect)s or a statement in lie) of prospect)s containing the partic)lars set o)t in 1art ! and the reports specified in 1art II of Sched)le IE and the said 1arts I and II shall ha+e effect s)b.ect to the pro+isions contained in 1art III of that Sched)le. (" If defa)lt is made in complying with s)b/section !" the company% and also e+ery officer of the company who is in defa)lt% shall be p)nishable with imprisonment for a term which may extend to two years% or with fine which may extend to fi+e tho)sand ta2e or with both. 9" Where any prospect)s or statement in lie) of prospect)s filed )nder this section imcl)des and )ntr)e statement% any person who a)thorised the filling of s)ch prospect)s or statement shall be p)nishable with imprisonment for a term which may extend to two years% or with fine which may extend to fi+e tho)sand ta2a% or with both% )nless he pro+es either that the statement was immaterial or that he had reasonable gro)nd to belie+e% and did )p to the time of the filing of the prospect)s or statement belie+e that the statement was tr)e. '" for the p)rposes of this section/ a" a statement incl)ded in a prospect)s or a statement in lie) of prospect)s shall be deemed to be )ntr)e if it is misleading in the form and context in which it is incl)ded; or b" where the omission from prospect)s or a statement in lie) of prospect)s of any matter is calc)lated to mislead% the prospect)s or statement in lie) of prospect)s shall be deemed% in respect of s)ch omission% to be a prospect)s or a statement in lie) of prospect)s in which an )ntr)e statement is incl)ded. 3" :or the p)rposes of s)b/section 9" and cla)se a" of s)b/section '" the expression 0incl)ded0 when )sed with reference to a prospect)s or statement in lie) of prospect)s% means incl)ded in the prospect)s or statement in lie) of prospect)s itself or contained in any report or memorand)m appearing on the face thereof% or by reference incorporated therein. .0.. Amendment of a(ticles fo( con9e(sion of a public company into p(i9ate company.# !" A p)blic company% ha+ing not more than fifty members at the time of con+ersion% may be con+erted into a pri+ate one by passing a special resol)tion altering its articles so as to excl)de pro+isions% if any% in the articles of association applicable to p)blic company and incl)de therein pro+isions applicable to a pri+ate company.

!B3

(" If the company has sec)red creditions% their wittren consent shall ha+e to be obtained before passing a resol)tion as per pro+ision of s)bsection !" and the shares enlisted with the stoc2 Exchange shall ha+e to be delisted. P(otection of mino(ity inte(est .00. Po$e( of Cou(t to 4i9e di(ection fo( p(otection4 inte(est of the mino(ity.# !" S)b.ect to f)lfilment of the conditions of the re8)ired minim)m as specified in section !&3 a" and b" any member or debent)reholder of a company may either indi+id)ally or .ointly bring to the notice of the co)rt by application that/ a" the affairs of the company are being cond)cted or the powers of the directors are being exercised in a manner pre.)dicial to one or more of its members or debent)re holders or in disregard of his or their interest; or b" the company is acting or is li2ely to act in a manner which discriminated or is li2ely to discriminate the interest of any member or debent)re holder; c" a resol)tion of the members% debent)re holders or any class of them has been passed or is li2ely to be passed which discriminates or is li2ely to discriminate the interest of one or more of the members or li2ely to debent)re holder: and pray for s)ch order% as in his or their opinion% wo)ld be necessary for safeg)arding his or their interest and also the interest of any other member or debent)re holder. (" #he $o)rt shall% on receipt of an application )nder s)b/section !" send a copy thereof to the 6oard and fix a date for hearing the application 9" If after hearing the parties present on the date so fixed% the $o)rt is of opinion that the interest of the applicant or applicants has been or is being or is li2ely to be pre.)dicially affected for reasons specified in the application% it may ma2e s)ch order as prayed for or s)ch other order as it deems fit incl)ding a direction/ a" to cancel or modify any resol)tion or transaction ; or b" to reg)late the cond)ct of the company7s affairs in f)t)te in s)ch manner as is specified therin. c" to amend any pro+ision of the memorand)m and articles of the company. '" Where by an order of the $o)rt% any amendment is made in the memorand)m or articles of the company% the company shall not% witho)t lea+e of the $o)rt% ma2e any amendment therein or ta2e any action which is inconsisten with the direction contained in he order. 3" A company shall% within fo)rteen days from the ma2ing of an order )nder this section% inform the Registrar in writing of s)ch order and send him a copy thereof% and if the company ma2es defa)lt in complying with this s)b/section the company% and also e+ery officer of the company who is in defa)lt% shall be liable to a fine not exceeding one tho)sand ta2a.

!B>

PA T ? E*N/*N8 2P
P(elimina(y .04. 'ode of $indin4 up.## !" #he winding )p of a company may be either. i" by the $o)rt; or ii" +ol)ntary; or iii" s)b.ect to the s)per+ision of the $o)rt. (" #he pro+isions of this Act with respect to winding )p shall apply% to the winding )p of a company in any of these modes% )nless any thing contrary appears. Cont(ibuto(ies .0&. ,iability as Cont(ibuto(ies of p(esent and past membe(s.## !" In the e+ent of a company being wo)ld )p e+ery present and past members shall% s)b.ect to the pro+isions of this section% be liable to contrib)te to the assets of the company to an amo)nt s)fficient for payment of its debts and liabilities and the coasts% charges and expenses of the winding )p% and for the ad.)stment of the rights of the $ontrib)tories among themsel+es% with the 8)alifications following% that is to say:// i" a past member shall not be liable to contrib)te if he has ceased to be a member for one year or )pwards before the commencement of the winding )p; ii" a past member shall not be liable to contrib)te in respect of any debt or liability of the company contracted after he ceased to be a member; iii" a past member shall not be liable to contrib)te )nless it appears to the $o)rt that the existing members are )nable to satisfy the contrib)tions re8)ired to be made by them in p)rs)ance of this Act; i+" in the case of a company limited by shares% no contrib)tion shall be re8)ired from any member exceeding the amo)nt% if any% )npaid on the shares in respect to which he is liable as a present or past member; +" in case of a company limited by g)arantee% no contrib)tion shall be re8)ired from any member exceeding the amo)nt )nderta2en to be contrib)ted by him to the assets of the company in the e+ent of its being wo)nd )p; +i" nothing in this Act shall in+alidate any pro+ision contained in any policy of ins)rance or other contract where by the liability of indi+id)al members on the policy or contract is restricted or whereby the f)nds of the company are alone made liable in respect of the policy or contract; +ii" a s)m d)e to any member of a company in his character of a member% by way of di+idends% profits or otherwise% shall not be deemed to be a debt of the company payable to that member in a case of competition between himself and any other creditor who is not a member of the company. (" In the winding )p of a company limited by g)arantee which has a share capital% e+ery member thereof shall be liable to pay the following amo)nts namely://

!B?

a" the amo)nt )nderta2en to be contrib)ted by him to the assets of the company in the e+ent of its being wo)nd )p; and b" an amo)nt to the extent of any s)ms )npaid on any shares held by him. .06. ,iability of di(ecto(s $hose liability is unlimited.## In the winding )p of a limited company% any director whether past or present% whose liability is% in p)rs)ance of this Act% )nlimited% shall% in addition to his own libility if any" to contrib)te as an ordinary member% be liable to ma2e a f)rther contrib)tion% as if he were at the commencement of the winding )p a member of an )nlimited company; 1ro+ided that// i" a past director shall not be liable to ma2e s)ch f)rther contrib)tion if he has ceased to hold office for a year or )pwards before the commencement of the winding )p; ii" a past director shall not be liable to ma2e s)ch f)rther contrib)tion in respect of any debt or liability of the company contracted after he ceased to hold office; iii" s)b.ect to the articles% a director shall not be liable to ma2e s)ch f)rther contrib)tion )nless the $o)rt deems it necessary to re8)ire contrib)tion in order to satisfy the debts and liabilities of the company and the costs% charges and expense of the winding )p. .0". 'eanin4 of =cont(ibuto(y=.## #he term 0contrib)tory0 means e+ery person liable to contrib)te to the assets of a company in the e+ent of its being wo)ld )p% and% in all proceedings for determining and in all proceedings prior to the final determination of the persons who are to be deemed contrib)tries% incl)des any person alleged to be a contrib)tory. .08. Natu(e of liability of cont(ibuto(y.## !" #he liability of the contrib)tory shall create a debt payable at the time specified in the calls made on him by the li8)idator. (" 4o claim fo)nded on the liability of a contrib)tory shall be congi-able by any $o)rt of Small $a)ses% .09. Cont(ibuto(ies in case of death of membe(.## !" If a contrib)tory dies either before or after the has been placed on the list of $ontrib)tories% his% legal representati+es and his heirs shall be liable in the d)e co)rse% of admini//ministration to contrib)te to the assets of the company in discharge of his liability and shall be $ontrib)tories accordingly. (" If the legal representati+es or heirs ma2e defa)lt in paying any money ordered to be paid by them% proceedings may be ta2en for administering the property of the deceased contrib)tory% whether mo+able or immo+able% or both% and for compelling payment there o)t of the money d)e. 9" :or the p)rpose of this section% the s)r+i+ing coparceners of a contrib)tory who is a member of a Hind) Koint :amily go+erned by the Hita2shara School of Hind) Caw shall be deemed to be his legal representati+es and heirs. .4%. Cont(ibuto(ies in case of insol9ency of membe(.## If a contrib)tory is ad.)dged insol+ent either before or after he has been placed on the list of contrib)tors% then// a" his assignese shall represent him for all the p)rposes of the winding )p% and shall be contrib)tories accordingly% and may be called on to admit to pro+e against the estate of the

!BA

insol+ent% or otherwise to allow to be paid o)t of his assets in d)e co)rse of law% any money d)e from the insol+ent in respect of his liability to contrib)te to the assets of the company; and b" there may be pro+ed against the estate of the insol+ent the estimated +al)e of his liability to f)t)re calls as well as already made. Eindin4 up by Cou(t .41. Ci(cumstances in $hich company may be $ound up by Cou(t.## A company may be wo)nd )p by the $o)rt; if// i" if the company has by special resol)tion resol+ed that the company be wo)nd )p by the $o)rt; or ii" if defa)lt is made in filing the stat)tory report or in holding the stat)tory meeting; or; iii" if the company does not commence its b)siness within a year from its incorporation% or s)spends its b)siness for a whole year; or i+" if the n)mber of members is red)ced% in the case of a pri+ate company below two% or% in the case of any other company% below se+en; or +" if the company is )nable to pay its debts; or +i" if the $o)rt is of opinion that it is .)st and e8)itable that the company sho)ld be wo)nd )p. .4.. Company $hen deemed unable to pay its debts.## !" A company shall be deemed to be )nable to pay its debts// i" if a creditor% by assignment or otherwise% to whome the company is indebted for a s)m exceeding fi+e h)ndred ta2e then d)e% has ser+ed on the company% by ca)sing the same to be deli+ered by registered post or otherwise at its registered office% a demand )nder his hands re8)iring the company to pay the s)m so d)e and the company has for three wee2s thereafter neglected to pay the s)m or to sec)re or compo)nd for it to the reasonable satisfaction of the creditor; or ii" if exec)tion or other process iss)ed on a decree or order of any co)rt in fa+o)r of a creditor of the company is ret)rned )nsatisfied in whole or in part; or iii" if it is pro+ed to the satisfaction of the $o)rt that the company is )nable to pay its deb)ts% the $o)rt shall ta2e into acco)nt the contingent and prospecti+e liabilities of the company. (" #he demand referred to in cla)se i" of s)b//section !" shall be deemed to ha+e been d)ly gi+en )nder the hand of the creditor if it is signed by an agent or legal ad+isor d)ly a)thorised on his behalf% or in the case of a firm% if it is signed by s)ch agent% or by a regal ad+iser or by any one member of the firm on behalf of the firm. .40. Eindin4 up may be (efe((ed to /ist(ict Cou(t.## Where the High $o)rt 5i+ision ma2es as order for winding )p of a company )nder this Act it may% if it thin2s fit% direct all s)bse8)ent proceedings to be had in a 5istrict $o)rt% and there)pon s)ch 5istrict $o)rt shall for the p)rpose of winding )p the company% be deemed to be 0the $o)rt0 within the meaning of this Act and shall

!B&

ha+e% fir the perposes of s)ch winding )p% all the .)risdiction and powers of the High $o)r 5i+ision. .44. T(ansfe( of $indin4 up f(om one /ist(ict Cou(t to anothe(.## If d)ring the progress of a winding )p in a 5istrict $o)rt it is made to appear to the High $o)rt 5i+ision that the same may be more con+eniently prosec)ted in any other 5istrict $o)rt% the High co)rt 5i+ision may transfer the same to s)ch other 5istrict $o)rt% and there )pon the winding )p shall proceed in s)ch other 5istrict $o)rt% and at any state of s)ch proceedings% that 5i+ision may with draw the proceedings from any of s)ch 5istrict $o)rts and dispose it of. .4&. P(o9isions as to applications fo( $indin4 up.## An application to the $o)rt for the winding )p of a company shall be by petition presented% s)b.ect to the pro+isions of this section% either by the company% or by any creditor or creditors% incl)ding any contingent or prospecti+e creditor or creditors% contrib)tory or contrib)tors% or by all or any of those parties% together or separately or by the Registrar: 1ro+ided that// a" a contrib)tory shall not be entitled to present a petition for winding )p a company% )nless// i" either the n)mber of members is red)ced in the case of a pri+ate company% below two% or% in the case of any other company% below se+en; or ii" the shares in respect of which he is a contrib)tory or some of them either were originally allotted to him or ha+e been held by him% and registered in his name for at least six months d)ring the eighteen months before the commencement of the winding )p% or ha+e de+ol+ed on him thro)gh the death of a former holder; b" the Registrar shall not be entitled to present a petitions for winding )p a company// i" except on the gro)nd from the financial condition of the company as disclosed in its balance sheet or from the report of an inspector appointed )nder section !&3 or% in a case falling within section (B'% it appears that the company is )nable to pay its debts; and ii" )nless the pre+io)s sanction of the *o+ernment has been obtained to the presentation of the petition: 1ro+ided that no s)ch sanction shall be gi+en )nless the company has first been afforded an opport)nity of being heard. c" a petition for winding )p of a company on the gro)nd of defa)lt in filing the stat)tory report or in holding the stat)tory meeting shall not be presented by any person except by a shareholder% nor before the expiration of fo)rteen days after the last day on which the meeting o)ght to ha+e been held; d" the $o)rt shall not gi+e a hearing to a petition for winding )p of a company by a contingent or prospecti+e credition )ntil s)ch sec)rity for costs has been gi+en as the $o)rt thin2s resonable and )ntil a prima fccie case for winding )p has been established to the satisfaction of the $o)rt. .46. +ffect of $indin4 up o(de(.## An order for winding )p of a company shall operate in fa+o)r of all the creditors and of all the contrib)tories of the company as if made on the .oin petition of a credition and of a contrib)tory.

!!B

.4". Commencement of $indin4 up by Cou(t.## A winding )p of a company by the $o)rt shall be deemed to commence at the time of the presentation of the petition for the winding )p. .48. Cou(t may 4(ant in>unction.## #he $o)rt may% at any time after the presentation of the petition for winding )p of a company )nder this Act and before ma2ing an order for winding )p the company% )pon the application of the company or of any creditor or contrib)tory of the company% restrain f)rther proceedings in any s)it or proceedings against the company and may also pass other similar order )pon s)ch terms as the $o)rt thin2s fit. .49. Po$e(s of Cou(t on hea(in4 peititon.## !" ,n hearing the petition% the $o)rt may dismiss it with or witho)t costs% or ad.o)rn the hearing conditionally or )nconditionally% or ma2e any interim order or any other order which% it deems .)st% b)t the $o)rt shall not ref)se to ma2e a winding )p order on the gro)nd only that the assets of the company ha+e been mortgaged to an amo)nt e8)ial to% or in excees of% those assets or that the company has no assets. (" Where the petition is presented on the gro)nd of defa)lt in filing the stat)tory report or in holding the stat)tory meeting the $o)rt may order the costs to be paid by any persons who% in the opinion of the $o)rt% are responsible for the defa)lt. 9" Where the $o)rt ma2es an order for the winding )p of a company% it shall% except where a li8)idator is appointed sim)ltaneo)sly% forthwith ca)se intimation thereof to be sent to the official recei+er. .&%. Suits stayed on $indin4 up o(de(.## When a winding )p order has been made or a pro+isional li8)idator has been appointed% no s)it or other legal proceedings shall be proceeded with or commenced against the company except by lea+e of the $o)rt and s)b.ect to s)ch terms as the $o)rt may impose. .&1. ?acancy in the office of liAuidato(.## !" :or the p)rposes of this Act% so far as it relaters to the winding )p of companies by the $o)rt% or% if there is no s)ch official recei+er% then s)ch person as the *o+ernment may% by notification in the official *a-ette% appoint for the p)rpose. (" ,n the ma2ing of a winding )p order the official recei+er shall become the official li8)idator of the company and shall contin)e to act as s)ch )ntil his f)rther contin)ance is terminated by an order of the $o)rt. 9" #he official recei+er shall% as the official li8)idator% forthwith ta2e into his c)stody and control all the boo2s% doc)ments and the assets of the company. '" #he official recei+er shall be entitled so s)ch rem)neration as the $o)rt shall fix. .&.. Copy of $indin4 up o(de( to be filed $ith the e4ist(a(.## !" ,n the ma2ing of a winding )p order% it shall be the d)ty of the petitioner in the winding )p proceedings and of the company to file with the Registrar a copy of the order within thirty days from the date of the ma2ing in the order. (" ,n the filing of a copy of a winding )p order% the Registrar shall register a s)mmary thereof in his boo2s relating to the company% and shall notify in the official *a-ette that s)ch an order has been made. 9" S)ch order shall be deemed to be notice of discharge to the ser+ants of the company except when the b)siness of the company is contin)ed.

!!!

.&0. Po$e( of Cou(t to stay $indin4 up.## #he $o)rt may% at any time after an order for winding )p% on the application of any creditor or contrib)tor% and on proof to the satisfaction of the $o)rt that all proceedings in relation to the winding )p o)ght to be stayed% ma2e an order staying the proceedings% either altogether or for a limited time% on s)ch terms and conditions as the $o)rt thin2s fit. .&4. Cou(t may ha9e (e4a(d to $ishes of c(edito(s o( cont(ibuto(ies## #he $o)rt may% as to all matters relating to a winding )p% ha+e regard to the wishes of the creditors or contrib)tories as pro+ed to it by any s)fficient e+idence. !fficial ,iAuidato( .&&. Appointment of official liAuidato(.## !" :or the p)rpose of cond)cting the proceedings in winding )p a company and performing s)ch d)ties in reference thereto as the $o)rt may impose% the $o)rt may appoint a person or persons% other than the official recei+er% to be called an official li8)idator or official li8)idators. (" #he $o)rt may ma2e s)ch an appointment pro+isionally at any time after the presentation of a petition and before the ma2ing of an order for winding )p% b)t shall% before ma2ing any s)ch appointment% gi+e notice to the company )nless for reasons to be recorded it thin2s fit to dispense with s)ch notice. 9" If more persons than one are appointed to the office of official li8)idator% the $o)rt shall declare whether any act% by this Act re8)ired or a)thorised% to be done by the official li8)idator is to be done by all or any one or more of s)ch persons. '" #he $o)rt may determine whether any and what sec)rity is to be gi+en by any official li8)idator on his appointment. 3" #he acts of an official li8)idator shall be +alid notwithstanding any defect that may afterwards be disco+ered in his appointment. 1ro+ided that nothing in this s)b//section shall be deemed to gi+e +alidity to acts done by an official li8)idator after his appointment has been show to be in+alid. >" A recei+er shall not be appointment of assets in the hands of an official li8)idator. .&6. esi4nations, (emo9als, fillin4 up 9acancies and compensation.## !" Any official li8)idator may resign% or may be remo+ed by the $o)rt on d)e ca)se shown. (" Any +acancy in the office of an official li8)idator appointed by the $o)rt shall be filled )p by the $o)rt and )ntil the +acancy is so filled )p the official recei+er shall be and act as the official li8)idator. 9" #here shall be paid to the official li8)idator s)ch salary or rem)neration by way of percentage or otherwise% as the $o)rt may direct and if more li8)idators that one are appointed% s)ch rem)neration shall be distrib)ted amongst them in s)ch proportions as the $o)rt directs. .&". !fficial liAuidato(.## #he official li8)idator shall be described by the style of the official li8)idator of the partic)lar company in respect of which he is appointed% and not by his indi+id)al name.

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.&8. Statement of affai(s to be made to the liAuidato(.## !" Where the $o)rt has made a winding )p order or appointment an official li8)idator pro+isionally% there shall% )nless the $o)rt thin2s fit to order otherwise and so orders% be made o)t and s)bmitted to the official li8)idator a statements as to the affairs of the company +erified by an affida+it and containing the following partic)lars% namely:// a" the assets of the company% staying separately the cash balance in hand and in the ban2% if any; b" the debts and other liabilities; c" the names% residences and occ)pations of the creditors stating separately the amo)nt of sec)red debts and )nsec)red debts% and in the case of sec)red debts% partic)lars of the sec)rities% their +al)e and the dates when they were gi+en; d" the debts d)e to the company and the names residences and occ)pations of the persons from whom they are d)e and the amo)nt li2ely to be realised therefrom. (" #he said statement shall be s)bmitted and +erified by one or more of the following persons.// a" the persons who were at the rele+ant date the directors and the person who was at that date the secretary% manager or other chief officer of the company% or. b" s)ch other person as the official li8)idator may% s)b.ect to he direction or $o)rt% re8)ire to s)bmit and +erify the statement% and the said other persons are the persons// i" who are or had been directors or officers of the company; ii" who ha+e ta2en part in the formation of the company at anytime within one year before the rele+ant date; iii" who are in the employment of the company or had been in the employment of the company within the said year referried to in s)b// section ii" abo+e% and are% in the opinion of the official li8)idator% capable of gi+ing the information re8)ired; i+" who are or had been within the said year to which the statement relates officers of or in the employment of a company. 9" #he statement small be s)bmitted within twenty/one days from the rele+ant date% or within s)ch extended time as the official li8)idator or the $o)rt may% for special reasons appoint. '" Any person ma2ing or conc)rring in ma2ing the statement and affida+it re8)ired by this section shall be allowed% and shall be paid by the official li8)idator or pro+isional li8)idator at the case may be o)t of the assets of the company% s)ch costs and expended inc)rred in and abo)t the preparation and ma2ing of the statement and affida+it as the official li8)idator may consider reasonable% s)b.ect to an appeal to the $o)rt. 3" If any person% witho)t reasonable exc)se% 2nowingly and wilf)lly ma2e defa)lt in complying with the re8)irements of this section% he shall be liable to a fine not exceeding fi+e h)ndred ta2e for e+ery day d)ring which the defa)lt contin)es. >" Any person stating himself in writing to be a creditor or contrib)tory of the company shall be entitled by himself on by his agent at all reasonable times% on payment of the prescribed fee% to !!9

inspect the statement s)bmitted in p)rs)ance of this section and to a copy thereof or extract therefrom. ?" Any person )ntr)thf)lly so stating himself to be a creditor or contrib)tory shall be g)ilty of an offence )nder section !A( of the 1enal $ode% !A>B DIE of !A>B"% and shall% on the application of the li8)idator or of the recei+er be p)nishable accordingly. A" In this section% the expression 0the rele+ant date0 means% in a case where no s)ch appointment is made% the date of the winding )p order. .&9. Statement by liAuidato(.## !" In a case where a winding )p order is made% the official li8)idator shall% as on as practicable after receipt of the statement to be s)bmitted )nder section (3A% and not later than one h)ndred and twenty days or with the lea+e of the $o)rt one h)ndred and sixty days from the date of the order% or in a case where the $o)rt orders that no statement shall be s)bmitted% as soon as practicable after the date of the order% s)bmit a preliminarly report to the $o)rt// a" as to the amo)nt of capital iss)ed% s)bscribed% and paid )p% and the estimated amo)nt of assets and liabilities gi+ing separately )nder the leading of assets% partic)lars of // i" cash and negotiable sec)rities; ii" debts d)e from contrib)tories; iii" debts d)e to and sec)rities% if any% a+ailable to the company% i+" mo+able and immo+able properties belonging to the company; +" )npaid calls% and b" if the company has failed as to the ca)se of the fail)re% and c" whether in his opinion f)rther in8)irey is desirable as to any matter relating to the promotion% formation% or fail)re of the company% or the cond)ct of the b)siness thereof. (" #he official li8)idatory may also% if he thin2s fit% ma2e a f)rther report or f)rther reports% stating the manner in which the company was formed and whether in his opinion any fra)d has been committed by any person in its promotion or formation or by any director or other officer of the company in relation to the company since the formation thereof% and any other matter which is his opinion it is desirable to bring to the notice of the $o)rt. .6%. Custody of company@s p(ope(ty.## !" #he official li8)idator% whether appointed pro+isionally or not% shall ta2e into his c)stody% or )nder his control all the property% effects and actionable claims to which the company is or appears to be entitled. (" All the property and effects of the company shall be deemed to be in the c)stody of the $o)rt as from the date of the order for the winding )p of the company. .61. Committee of *nspection in compulso(y $indin4 up.## !" #he official li8)idator shall% within a month from the date of the order for the winding )p of a company% con+ene a meeting of the creditors of the company% as ascertained from the boo2s and doc)ments of the company% for the p)rpose of determining whether or not a committee of inspection shall be appointed to act with the li8)idator% and who are to be members of the committees% if appointed. !!'

(" #he official li8)idator shall% within a wee2 from the he date of the creditors meeting con+ence a meeting of the contrib)tories to consider the decision of the creditors and to accept the same with or witho)t modification. 9" If the contrib)tories do not accept the decision of the creditors in its entirely% it shall be the d)ty of the official li8)idator to apply to the $o)rt for directions as to whether there shall be a committee% and who shall be members thereof. '" A committee of inspection appointed )nder this section shall consist of not more than twel+e members being creditors and contrib)tories of the company or persons holding general or special powers of attorney from creditors or contrib)tories in s)ch proportions as may be agreed on by the meetings of creditors and contrib)tories% or as% in case of difference% may be determined by the $o)rt. 3" #he committee of inspection shall ha+e the right to inspect the acco)nts of the official li8)idator at all reasonable times. >" #he committee shall meet at s)ch times as they may from time to time appoint% and% failing s)ch appointment% at least once a month% and the li8)idator or any member of the committee may also call a meeting of the committee as and when he thin2s necessary. ?" #he committee may act by a ma.ority of their members present at a meeting% b)t shall not act )nless a ma.ority of the committee are present. A" A member of the committee may resign by notice in writing signed by him and deli+ered to the li8)idator. &" If a member of the committee becomes ban2r)pt% or compo)nds or arranges with his creditors% or is absent from fi+e consec)ti+e meetings of the committee witho)t the lea+e of those members who together with himself represent the creditors or contrib)tories% as the case may be% his office shall there)pon became +acant. !B" A members of the committee may be remo+ed therefrom by an ordinary resol)tion at a meeting of creditors if% he represents creditors% or of contrib)tories% if he represents contrib)tories% of which se+en days% notice has been gi+en% stating the ob.ect of the meeting. !!" ,n a +acancy occ)rring in the committee% the li8)idator shall forthwith s)mmon a meeting of creditors or of contrib)tories% as the case may re8)ire% to fill in the +acancy% and the meeting may% by resol)tion% re/appoint the same or appoint another creditor or contrib)tory to fill in the +acancy. !(" #he Fontin)ng members of the committee% if not less than two% may set notwithstanding any +acancy in the committee. .6.. Po$e(s of official liAuidato(.## #he official li8)idator shall ha+e power with the sanction of the $o)rt% to do the following things// a" to instit)te or defend any s)it or prosec)tion% or other leagl proceeding% ci+il or criminal% in the name and on behalf of the company; b" to carry on the he b)siness of the company so far as may be necessary% for the beneficial winding )p of the same%

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c" to sell the immo+able and mo+able property of the company by p)blic a)ction on pri+ate contract% with power to transfer the whole thereof to any person or organisation or company% or to sell the same in parecis. d" to do all acts and to exec)te% in the name and on behalf of the company% all deeds% receipts% and other doc)ments% and for that p)rpose to )se% when necessary the company7s common seal; e" to pro+e% ran2 and claim in the insol+ency of any contrib)tory% for any balance a against his estate% and to recei+e di+idends in the insol+ency% in respect of that balance% as a separate debt d)e from the insol+ent% and rateably with the other separate creditors; f" to draw% accept% ma2e and endorse any bill of exchange% h)ndi or promissory note in the name and on behalf of the company% with the same effect with respect to the liability of the company as if the bill% h)ndi or note had been drawn% accepted% made or endorsed by or on behalf of the company in the co)rse of its b)siness; g" to raise on the sec)rity of the assets of the company any more re8)isite; h" to ta2e o)t in his official name letters of administration relating to the estate of any deceased contrib)tory or his estate which cannot be con+eniently done in the name of the company% and in all s)ch cases the money d)e shall% for the p)rpose of enabling the li8)idator to ta2e o)t the letters of administration or reco+er the money be deemed to be d)e to the li8)idator or himself; 1ro+ided that nothing in cla)se h" shall be deemed to affect the rights% d)ties and pri+ileges of the Administrator *eneral appointed )nder the Administrator *eneral7s Act% !&!9 III of !&!9"; i" to do all s)ch other things as may be necessary for winding )p the affairs of the company and distrib)ting its assets. .60. ,imit of /isc(etion of official liAuidato(.## #he $o)rt may pro+ide by any order that the official li8)idator may exercise any of the abo+e powers witho)t the sanction or inter+ention of the $o)rt% and% where an official li8)idator is pro+isionally appointed% may limit and restrict his powers by the order appointing him. .64. P(o9ision fo( le4al assistance to official liAuidato(.## #he ,fficial li8)idator may% with the sanction of the $o)rt% appoint an ad+ocate or attorney entitled to appear before the $o)rt to assist him in the performance of his d)ties; 1ro+ided that% where the official li8)idator is an ad+ocate or attorney% he shall not appoint his partner% )nless the latter consents to act witho)t rem)neration. .6&. ,iAuidato( to <eep boo<s containin4 p(oceedin4 of meetin4s and to submit account of his (eceipts to Cou(t.## !" #he official li8)idator of a company which is being wo)nd )p by the $o)rt shall 2eep% in the manner prescribed% proper boo2s in which he shall ca)se to be made entries or min)tes of proceedings at meetings and of s)ch other matters as may be prescribed% and any creditor or contrib)tory may% s)b.ect to the control of the $o)rt% personally or by his agent% inspect any s)ch boo2s. (" E+ery official li8)idator shall% at s)ch times as may be prescribed b)t not less than twice in each year d)ring his ten)re of office% present to the $o)rt an acco)nt of his receipts and payments as s)ch li8)idator.

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9" #he li8)idator shall prepare the acco)nt in the prescribed form in d)plicate% and shall +erify it by a declaration in the prescribed form. '" #he $o)rt shall ca)se the acco)nt to be a)dited in s)ch manner as it thin2s fit and for the p)rpose of the a)dit the li8)idator shall f)rnish the $o)rt with s)ch +o)chers% and boo2s or other doc)ment as the $o)rt may re8)ire% and the $o)rt may at any time re8)ire the prod)ction of an inspect any boo2s or acco)nt 2ept by the li8)idator. 3" When the acco)nt has been a)dited% one copy thereof shall be filed and 2ept by the $o)rt% and the other copy shall be deli+ered to the Registrar for filing% and each copy shall be open to the inspection of any creditor or any person interested. .66. +3ce(cise and cont(ol of liAuidato(@s po$e(s## !" S)b.ect to the pre+isions of this Act% the official li8)idator of a company which is being wo)nd )p by the $o)rt shall% in the administration of the assets of the company and in the distrib)tion thereof among its creditors% ha+e regard to any directions that may be gi+en by resol)tion of the creditors or contrib)tories at any general meeting shall% in case of confilict be deemed to o+er ride any directions gi+en by the committee of inspection. (" #he official li8)idator may s)mmon general meeting of the creditors or contrib)tories for the p)rpose of ascertaining their wishes% and it shall be his d)ty to s)mmon meeting at s)ch times as the creditors or contrib)tories by resol)tion% may direct% or whene+er re8)ested in writing to do so by one tenth in +al)e of the creditors or contrib)tiries% as the case may be. 9" #he official li8)idator may apply to the $o)rt in the manner prescribed for directions in relation to any partic)lars matter arising in the winding )p. '" S)b.ect to the pro+ision of this Act% the official li8)idator shall )se his own discretion in the administration of the assets of the company and in the distrib)tion thereof among the creditors. 3" If any person is aggrie+ed by any act or decision of the official li8)idator% that person may apply to the $o)rt% and the $o)rt may confirm% re+erse or modify the act or decision complained of% ma2e s)ch order as it thin2s .)st in the he circ)mstances. !(dina(y Po$e(s of Cou(t .6". Settlement of list of cont(ibuto(ies and application of assets.## !" As soon as may be after ma2ing a winding )p order% the $o)rt% shall settle a list of contrib)tories% shall ha+e power to register of members in all cases where rectification is re8)ired in p)rs)ance of this Act% and shall ca)se the assets of the company to be collected and applied in discharge of its liabilities. (" In setling the list of contrib)tories% the $o)rt shall disting)ish between persons who are contrib)tories in their own right and persons who are contrib)tories as being representati+es of or liable for the debts of others. .68. Po$e( to (eAui(e t(ansfe(, deli9e(y etc of p(ope(ty.## #he $o)rt may at any time after ma2ing a winding )p order% re8)ire any contrib)tory for the time being settled on the list of contrib)tories and any tr)stee% recei+er% ban2er% agent% or officer of the company to pay% deli+er s)rrender or transfer forthwith% or within s)ch time as the $o)rt directs% to the official li8)idator any money property or doc)ments in his hands to which the company is prima facie entitled. .69. Po$e( to o(de( payment of debts by cont(ibuto(y.## !" #he $o)rt may% at any time after ma2ing a winding )p order% ma2e an order any contrib)tory for the time being settled on the list of

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contrib)tories to pay% in the manner directed by the order% any money d)e from him or from the estate of the person whom he represents to the company excl)si+e of any money payable by him or the estate by +irt)e of any call in p)rs)ance of this Act. (" #he $o)rt in ma2ing s)ch an order may% in the case of an )nlimited company% allow to the contrib)tory by way of set/off any money d)e to him or to the estate which he represents from the company% on any independent dealing or contract with the company% b)t not any money d)e to him as a member of the company in respect of any di+idend or profit% and may% in the case of a limited company% made to any director whose liability is )nlimited or to his estate the li2e allowance: 1ro+ided that% the case of any company% whether limited or )nlimited% when all the creditors are paid in f)ll any money d)e on any acco)nt whate+er to a contrib)tory from the company may be allowed to him by way of set/off against any s)bse8)ent call. ."%. Po$e( of Cou(t to ma<e calls.## !" #he $o)rt may% at any time after ma2ing a winding )p order% and that is either before or after it has ascertained the s)fficiency of the assets of the company% ma2e calls on and order payment there of by all or any of the contrib)tiries for the time being settled on the list of the contrib)tories to the extent of their liability% for payment of any money which the $o)rt considers necessary to satisfy the debts and liabilities of the company% and the costs% charges and expenses of winding )p% and for the ad.)stent of the rights of the contrib)tories among themsel+es. (" In ma2ing the call the $o)rt may ta2e into consideration the probability that some of the contrib)tories may partly or wholly fail to pay the call. ."1. Po$e( to o(de( payment into ban<.## #he $o)rt may order any contrib)tory% p)rchaser or other person from whom money is d)e to the company to pay the same into the acco)nt of the official li8)idator in any sched)led ban2s as defined in the 6angladesh 6an2 ,rder% !&?( 1.,. 4o. !(?"% instead of to the official li8)idator and any s)ch order may be enforced in the same manner as if it had made direct payment to the official li8)idator. .".. e4ulation of account $ith Cou(t.## All moneys% bills% h)ndis% notes and other sec)rities paid and deli+ered into the ban2 where the li8)idators of the company may ha+e his acco)nt% in the e+ent of a company being wo)nd )p by the $o)rt% shall be s)b.ect in all respect to the orders of the $o)rt. ."0. o(de( on cont(ibuto(y conclusi9e e9idence5## !" An order made by the $o)rt on a contr)b)tory shall% s)b.ect to any right of appeal% be concl)si+e e+idence that the money% if any% thereby appearing to be d)e or ordered to be paid is d)e. (" All other pertinent matters stated in the order shall be ta2en to be tr)ly stated as against all persons% and in all proceedings whatsoe+er. ."4. Po$e( to enclude c(edito(s not p(o9idin4 in time 5## #he $o)rt may fix a time or times within which creditors are to pro+e their debts or claims% or to be excl)ded from the benefit of any distrib)tion made before those debts are pro+ed. ."&. Ad>ustment of (i4ht of cont(ibuto(ies5## #he $o)rt shall ad.)st the right of the contrib)tories among themsel+es% and distrib)te any s)rpl)s among the persons entiled thereto. ."6. Po$e( to o(de( cost5# #he $o)rt may% in the e+ent of the companys assets being ins)fficient to satisfy the liabilities% ma2e an order as to the payment% o)t of the assets% of the

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costs% charges and expenses% inc)rred in the winding )p in s)ch order of priority as the $o)rt thin2s .)st. ."". /issolution of company## !" When the affairs of a company ha+e been completely wo)nd )p% the $o)rt shall ma2e an order that the company be dissol+ed from the date of the order% and the company shall be dissol+ed accordingly. (" #he order shall be reported within fifteen days of the ma2ing thereof by the official li8)idator to the Registrar% who shall record in his ma2e boo2s a min)te of the dissol)tion of the company. 9" If the official li8)idator ma2es defa)lt in complying with the re8)irements of this section% he shall be liable to a fine not exceeding one h)ndred ta2a for e+eryday d)ring which he is in defa)lt. +3t(ao(dina(y Po$e(s of Cou(t ."8. Po$e( to summon pe(sons suspected of ha9in4 p(ope(ty of company5## !" #he $o)rt may% after it has made a winding )p order% s)mmon before it any officer of the company or person 2nown or s)spected to ha+e in his possession any property of the company% or s)pposed to be indebted to the company% or any person whom the $o)rt deems capable of gi+ing information concerning the trade% dealing% affairs or property of the company. (" #he $o)rt may examine him on oath concerning the same% either by word of mo)th or on written interrogatories% and may red)ce his answers to writing and re8)ire him to sing them. 9" #he $o)rt may re8)ire him to prod)ce any doc)ments in his c)stody or power relating to the company; b)t% where he claims any lien on doc)ments prod)ced by him% the prod)ction shall be witho)t pre.)dice to that lion% and the $o)rt shall ha+e .)risdiction in the winding )p to determine all 8)estions relating to that lien. '" If any person so s)mmoned% after being tendered a reasonable s)m for his expens% ref)ses to come before the $o)rt at the time appointed% not ha+eing a lawf)l impediment made 2nown to the $o)rt at the time of its sitting and allowed by it% the $o)rt may ca)se him to be apprehended and bro)ght before the $o)rt for examination. ."9. Po$e( to o(de( public e3amination of p(omoto(s, etc5## !" When an order has been made for winding )p a company by the $o)rt% and the official li8)idator has applied to the $o)rt stating that in his opinion% a fra)d has been committed by any person in the promotion or formation of the company or by any director or other officer of the company% in relation to the company since its formation% the $o)rt may% after consideration of the application% direct that any person who has ta2en any part in the promotion or formation of the company or has been a director manager or other officer of the company shall attend before the $o)rt on a day appointed by the $o)rt for that p)rpose attend before the $o)rt on a day appointed by the $o)rt for that p)rpose% and be p)blicly examined as to the promotion or formation or the cond)ct of the b)siness of the company% or as to his cond)ct and dealings as director manager or other officer thereof. (" #he official li8)idator shall ta2e part in the examination and for that p)rpose may% if specially a)thorised by the $o)rt in that behalf% employ s)ch legal assistance as may be sanctioned by the $o)rt. 9" Any creditor or contrib)tory may also ta2e part in the examination either personally or by any person entitled to appear before the o)rt.

!!&

'" #he $o)rt may p)t s)ch 8)estions to the person examined as the $o)rt thin2s fit. 3" #he person examined shall be examined on oath% and shall answer all s)ch 8)estions as the $o)rt may p)t or allow to be p)t to him. >" A person ordered to be examined )nder this section may at his own cost employ any person entitled to appear before the $o)rt% who shall be at liberty to p)t to him s)ch 8)estions as the $o)rt may deem .)st for the p)rpose of enabling him to explain or 8)alify any answers gi+en by him; 1ro+ided that if he is% in the opinion of the $o)rt% exc)lpated from any charges made or s)ggested against him s)ch costs as% in its discretion% it may thin2 fit. ?" 4otes of the examination shall be ta2en down in writing% and shall be read o+er to or by% and signed by% the person examined% and may thereafter by )sed in e+idence against him in ci+il proceedings% and shall be open to the inspection of any creditor or contrib)tory at all resonable times. A" #he $o)rt may% if it thin2s fit% ad.o)rn the examination from time to time. &" An examination )nder this section may% if the $o)rt so directs% and s)b.ect to any r)les in this behalf% be held before any 5istrict K)dge or before any officer of the High $o)rt 5i+ision being an official referee% master% Registrar or 5ep)ty Registrar and the powers of the $o)rts )nder this section as to the cond)ct of the examination% b)t not as to costs% may be exercised by the person before whom the examination is held. .8%. Po$e( to a((est abscondin4 cont(ibution(y5## #he $o)rt% at any time either before or after ma2ing a winding )p order and on proof of probable ca)se for belie+ing that a contrib)tory is or abo)t to 8)it 6angladesh or otherwise to abscond% or to remo+e or conceal any of his property% for the p)rpose of e+ading payment of calls or of a+oiding examination respecting the affairs of the company% may ca)se the contrib)tory to be arrested and his boo2s and papers and mo+able property to be si-ed% and him and them to be safe castody )ntil s)ch times as the $o)rt may order. .81. Sa9in4 of othe( p(oceedin4s5## Any powers by this Act conferred on the $o)rt shall be in addition to and not in restriction of% any existing powers of instit)ing proceedings against any contrib)tory or debtor of the company% or the estate of any contrib)tory or debtor for the reco+ery of any call or other s)ms.

+nfo(cement of and appeal f(om !(de(s .8.. Po$e( to enfo(ce o(de(s5## All orders made by the $o)rt )nder this Act may be enforced in the same manner in which decrees of s)ch $o)rt mad in any s)it pending therein may be enforced. .80. !(de( made in any Cou(t to be enfo(ced by othe( Cou(ts.## Any order made by the $o)rt for or in the co)rse of the winding )p of a company shall be enforced in any place in 6angladesh by any other co)rt that wo)ld ha+e had .)risdiction in respect of s)ch company if the registered office of the company had been sit)ate at s)ch place and in the same manner in all respect as if s)ch order had been made by the co)rt that is hereby re8)ired to enforce the same% b)t in

!(B

relation to the place where the registered office of the company is sit)ate% only the co)rt ha+ing .)risdiction co+er s)ch place shall enforce s)ch order. .84. 'ode of dealin4 $ith o(de( to be enfo(ced by othe( Cou(ts.## Where any order made by one $o)rt is to be enforced by another $o)rt% a certified copy of the order so made shall be prod)ced to the proper officer of the $o)rt re8)ired to enforce the same% and the prod)ction of s)ch certified copy shall be s)fficient e+idence of s)ch order ha+ing been made; and there)pon the last mentioned $o)rt shall ta2e the re8)isite steps in the matter for enforcing the order% in the same manner as if it were the order of the $o)rt enforcing the same. .8&. Appeal f(om o(de(s5## Re//hearing of% and appeals from order or decision made or gi+en in the matter of the winding )p of a company by the $o)rt may be had in the same manner and s)b.ect to the same conditions in and s)b.ect to which appeals may be had from any order or decision of the same $o)rt in cases within its ordinary .)risdiction. ?olunta(y Eindin4 2p .86. Ci(cumstances in $hich company may be $ound up 9olunta(ily5## !" A company may be wo)nd )p +ol)ntarily// a" when the period% if any% fixed for the d)ration of the company by the articles expires% or the e+en% if any occ)rs% on the occ)rrence of which articles pro+ide that the company is to be dissol+ed and the company in general meeting has passed a resol)tion re8)iring the company to be wo)nd )p +ol)ntarily; b" if the company resol+es by special resol)tion that the company be wo)nd )p +ol)ntarily; c" if the company resol+es by extraordinary resol)tion to the effect hat it cannot by reason of its liabilities contin)e its b)siness% and that it is ad+isable to wind )p. (" #he expression 0rescl)tion for +ol)ntarily winding )p0 when )sed hereafter in this 1art means a resol)tion passed )nder cla)se a"% cla)se b"% or cla)se c" of this section. .8". Commencement of 9olunta(y $indin4 up.## A +ol)ntary winding )p shall be deemed to commence at the time of the passing of the resol)tion for +ol)ntary winding )p. .88. +ffect of 9olunta(y $indin4 up on status of company.## When a company is wo)nd )p +ol)ntarily% the company shall% from the commencement of the winding )p% cease to carry in its b)siness% except so far as may be re8)ired for the beneficial winding )p thereof: 1ri+ided that the corporate state and corporate powers of the company shall% notwithstanding anything to the contarary in its articles% contin)e )ntil it is dissol+ed. .89. Notice of (esolution to $ind up 9olunta(ily.## !" 4otice of any special resol)tion or extraordinary resol)tion for winding )p a company +ol)ntarily shall be gi+en by the company within ten days of the passing of the same by ad+ertisement in the official *a-ette% and also in some news paper% if any circ)lating in the district where the registered office of the company is sit)ate. (" If a company ma2es defa)lt in complying with the re8)irements of this section% it shall be liable to a fine not exceeding on h)ndred ta2a for e+ery day d)ring which the defa)lt contin)es; and also e+ery officer of the company who 2nowingly and wilf)lly a)thorises or permits the defa)lt shall be liable to a li2e penalty.

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.9%. /ecla(ation of sol9ency.## !" Where it is proposed to wind )p a company +ol)ntarily% the directors of the company or% in the case of a company ha+ing more than two directors% the ma.ority of the directors shall at a meeting of the directors held before the date on which the notice of the meeting at which the resol)tion of the winding )p the company is to be proposed are sent o)t% ma2e a declaration +erified by an affida+it to the effect that they ha+e made a f)ll in8)iry into the affairs of the company and that% ha+ing so done% they formed the opinion that the company will be able to pay its debts in f)ll within a period% not exceeding three years% from three commencement of the winding )p. (" S)ch declaration shall be s)pported by a report of the company7s a)ditors on the company7s affairs% and shall ha+e no effect for the p)rposes of this Act )nless it is deli+ered to the Registrar for registration before the date mentioned in s)b/section !". 9" A winding )p% in the case or which a declaration has been made and deli+ered in accordance with s)b//sections !" and ("% is in this Act referred to as 0members +ol)ntars winding )p0% and% where a declaration has not been made and deli+ered as aforesaid% is in this Act referred to as 0creditors +ol)ntary winding )p.0 'embe(s@ ?olunta(y Eindin4 up .91. P(o9isions applicable to a membe(s@ 9olunta(y $indin4 up.## #he pro+isions contained in section (&( to (&> both incl)si+e"% shall apply in relation to a members +ol)ntary winding )p. .9.. Po$e( of company to appoint and fi3 (emune(ation of liAuidato(.## !" #he company in general meeting shall appoint one or more li8)idators for the p)rpose of winding )p the affairs and distrib)ting the assets of the company% and may fix the rem)neration to be paid to him or them. (" ,n the appointment of li8)idator% all the powers of the directors shall cease% except so far as the company in general meeting or the li8)idator% sanctions the contin)ance thereof. .90. Po$e( to fill 9acancy in the office of liAuidato(.## !" If a +acancy occ)rs by death% resignation or otherwise in the office of li8)idator appointed by the company% the company in general meeting may% s)b.ect to any agreement with its creditors% fill +acancy. (" :or the p)rpose of filling in the said +acancy% a general meeting may be con+ented by any contrib)tory or% if there were more li8)idators than one% by the contin)ing li8)idator. 9" #he meeting shall be held in the manner pro+ided by this Act or by articles% or in s)ch manner as may% on application by any contrib)tory or by the contin)ing li8)idators% be determined by the $o)rt. .94. Po$e( of liAuidato( to accept sha(es, etc as conside(ation fo( sale of p(ope(ty of company.## !" Where a company is proposed to be% or is in co)rse of being% wo)nd )p altogether +ol)ntarily% and the whole or part of its b)siness or property is proposed to be transferred or sold to another company% whether a company within the meaning of this Act or not% in this section called 0the transferee company0% may with the sanction of a special resol)tion of that company conferring either a general a)thority on the li8)idator or an a)thority in respect of any partic)lar arrangement% recei+e% in compensation or part compensation for the transfer or sale% shares% polices% or other li2e interests in the transferee company% for distrib)tion among the members of the transferor company% or may enter into any other arrangement where by the members of the transferor company may% in lie) of recei+ing cash or shares% policies or other li2e interests or in

!((

addition thereto% participate in the profits of% or recei+e any other benefit from% the transferee company. (" Any sale or other transfer or arrangement in p)rs)ance of this section shall be binding on the members of the transferor company. 9" If any member of the transferor company who did not +ote in fa+o)r of the special resol)tion expresses his dissent therefrom in writing addressed to the li8)idator and left at the registered office of the company within se+en days after the passing of the special resol)tion% by may re8)ire the li8)idator either to abstain from carrying the resol)tion into effect or to p)rchase his interest at a price to be determined by agreement or any arbitration in manner hereafter pro+ided. '" If the li8)idator elects to p)rchase the member7s interest% the p)rchase money m)st be paid before the company is dissol+ed% and be raised by the li8)idator in s)ch manner as may be determined by special resol)tion. 3" A special resol)tion shall not be in+alid% for the p)rpose of this section by reason only that it is passed before or conc)rrently with a resol)tion for +ol)ntary winding )p or for appointment of li8)idators% b)t if an order is made within a year for winding )p the company by or s)b.ect to the s)per+ision of the $o)rt% the special resol)tion shall not be +alid )nless sanctioned by the $o)rt. >" #he pro+isions of the Arbitration Act% !&'B D of !&'B"% other that those restricting the application of the Act in respect of the s)b.ect matter of the arbitration% shall apply to all arbitrations in p)rs)ance of this section. .9&. /uty of liAuidato( to call 4ene(al meetin4 at the end of each yea(5## !" In the e+ent of the winding )p contin)ing for more than one year% the li8)idator shall s)mmon a general meeting of the company at the end of the first year from the commencement of the winding )p and of each s)cceeding year% or as soon thereafter as may be con+enient within ninety days% of the close of the year% and shall lay before the meeting an acco)nt of his acts and dealings and of the cond)ct of the winding )p d)ring the proceeding year and a statement in the preseribed form containing the prescribed partic)lars with respect to the position of the li8)idation. (" If the li8)idator fails to comply with this section% he shall be liable to a fine not exceeding fi+e h)ndred ta2a. .96. 7inal meetin4 and dissolution## !" As soon as the affairs of the company are f)lly wo)nd )p% li8)idator shall ma2e )p an acco)nt of the winding of )p showing how the winding )p has been cond)cted and the property of the company has been disposed of% and there)pon shall call a general meeting the company for the p)rpose of laying before it the acco)nt% and gi+ing explanation thereof. (" #he meeting shall be called by ad+ertisement specifying the time% place and ob.ect thereof and p)blished one month at least before the meeting in the manner specified in s)b/section !" of section (A& for p)blication of a notice )nder that s)b//section; 9" Within one wee2 after the meeting the li8)idator shall send to the Registrar a copy of the acco)nt and shall ma2e a ret)rn to him of the holding of the meeting and of its date% and if the copy is not sent or the ret)rn is not made in accordance with this s)b/section% the li8)idator shall be liable to a fine not exceeding one h)ndred ta2a for e+eryday d)ring which the defa)lt contin)es:

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1ro+ided that% if a 8)or)m is not present at the meeting the li8)idator shall in lie) of the said ret)rn ma2e a ret)rn that the meeting was d)ly s)mmoned and that no 8)or)m was present thereat% and )pon s)ch a ret)rn being made the pro+isions of this s)b//section as to the ma2ing of the ret)rn shall deemed to ha+e been complied with. '" #he Registrar on recei+ing the acco)nt and either of the ret)rns mentioned in s)b/section 9" shall forthwith register them and on the expiration of three months from the registration of the ret)rn the company shall be deemed to be dissol+ed: 1ro+ided that the $o)rt may% on the he application of the li8)idator or of any other person who appears to the $o)rt to be interested% ma2e an order deferring the date at which the dissol)tion of the company is to effect for s)ch time as the $o)rt thin2s fit. 3" It shall be the d)ty of the person on whose application an order of the $o)rt )nder s)b// section '" is made% within twenty//one after the ma2ing of the order% to deli+er to the Registrar a certified copy of the order for registration and if that person fails so to do he shall be liable to a fine not exceeding one h)ndred ta2a for e+ery day d)ring which the defa)lt contin)es. C(edito(@s 9olunta(y $indin4 up .9". P(o9ision applicable to a 9onuta(y $indin4 up5## #he pro+isions contained in sections (&A to 9B3% both incl)si+e% shall apply in relation to a creditors +ol)ntary winding )p. .98. 'eetin4 of c(edito(s5## !" #he company shall ca)se a meeting of the creditors of the company to be s)mmoned for the day% or the day next following the day% on which there is to be held the meeting at which the resol)tion for +ol)ntary winding )p is to be proposed% and shall ca)se the notices of the said meeting of creditors to be sent by post to the creditors sim)ltaneo)sly with the sending of the notices of the said meeting of the company at which s)ch resol)tion will be proposed. (" #he company shall also ca)se notice of the meeting of the creditors be ad+ertised in the manner specified in s)b//section !" of section (A& for the p)blication of a notice )nder that s)b// section. 9" #he directors of the company shall// a" ca)se a f)ll statement of the position of the companys affairs together with a list of the creditors of the company and the estimated amo)nt of their claims to be laid% before the meeting of creditors to be held as aforesaid; and b" appoint one of their n)mber to preside at the said meeting '" It shall be the d)ty of the director appointed to preside at the meeting creditors to attend the meeting and to preside thereat. 3" If the meeting of the company at which the resol)tion for +ol)ntary winding )p is to be proposed is ad.o)rned and the resol)tion is passed at an ad.o)rned meeting% any resol)tion passed at the meeting of the creditors held in p)rs)ance of s)b/section !" shall ha+e effect as if it had been passed immediately after the passing of the resol)tion for winding of the company. >" If defa)lt is made// a" by the company in complying with s)b//sections !" and (";

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b" by the board of directors of the company in complying with s)b// section 9"; c" by any director of the company in complying with s)b//section '". the company% e+ery member of the board of directors or director% as the case may be% shall be liable to a fine not exceeding fi+e tho)sand ta2a and% in the case of defa)lt by the company e+ery officer of the company who is in defa)lt shall be liable to the li2e penalty. .99. Appointment of liAuidato(.## #he creditors and the company at their respecti+e meetings mentioned in section (&A may nominate a person to be li8)idator for the p)rpose of winding )p the affairs and distrib)ting the assets of the company% and if the creditors and the company nominate different persons% the person nominated by the creditors shall be the li8)idator% and if no person is nominated by the creditors the person% if any% nominated by the company shall be li8)idator. 1ro+ided that in the case of different persons being nominated% any director% member or creditor of the company may% within se+en days after the date on which the nomination was made by the creditors% apply to the $o)rt for an order either directing that the person nominated as li8)idator by the company shall be li8)idator instead of or .ointly with the person nominated by the creditors% or appointing some other person to be li8)idator instead of the person appointed by the creditors. 0%%. Appointment of committee of inspection.## #he creditors at the meeting to be held in p)rs)ance of section (&A or at any s)bse8)ent meeting may% if they thin2 fit% appoint a committee of inspection consisting of not more than fi+e persons and if s)ch a committee is appointed the company may% either at the meeting at which the resol)tion for +ol)ntary winding )p is passed or at anytime s)bse8)ently in general meeting% appoint s)ch n)mber of persons as they thin2 fit to act as members of the committee not exceeding fi+e in n)mber: 1ro+ided that the creditors may% if they thin2 fit% resol+e that all or any of the persons so appointed by the company to be members of the committee of inspection and% if the creditors so resol+e% the persons mentioned in the resol)tion shall not% )nless the $o)rt otherwise directs% be 8)alified to remain or to act as members% of the committee% and on any application to the $o)rt may )nder this pro+isior the $o)rt may% if it thin2s fit% appoint other persons to act as s)ch members in place of the persons mentioned in the resol)tion. 0%1. 7i3in4 of liAuidato(s (emune(ation and cessation of di(ecto(s po$e(s.## #he committee of inspection% or if there is no s)ch committee% the creditors may fix the rem)neration to be paid to the li8)idator or li8)idators% and where the rem)neration is not so sixed% it shall be determined by the $o)rt. (" ,n the appointment of a li8)idator% all the powers of the directors shall cease% except so far as the committee of inspection% or if there is no s)ch committee% the creditors sanction the contin)ance thereof. 0%.. Po$e( to fill 9acancy in the office of liAuidato(.## If a +acancy occ)rs by death% resignation or otherwise% in the office of a li8)idator then the +acancy maybe filled in by the $o)rt when the li8)idator was appointed by the $o)rt or by the creditors where the li8)idator was appointed by creditors. 0%0. Application of section .94 to a c(edito(s 9ointa(y $indin4 up.## #he pro+isions of section (&' shall apply the case of a creditors +ol)ntary winding )p as in the he case of a members +ol)ntary winding )p with the modification that the powers of the li8)idator )nder the said section shall not be exercise with the saction either the of $o)rt or of the committee of inspection.

!(3

0%4. /uty of liAuidato( to call meetin4 of company and of c(edito(s at the yea( and.## !" In the e+ent of the winding )p contin)ing for more than one year% the li8)idator shall s)mmon a general meeting of the company and a meeting of creditors at the end of the first year from the commencement of the winding )p% and of each s)cceeding year% or as soon thereafter as may be con+enient and shall lay before the meetings an acco)nt of his acts and dealing and of the cond)ct of the winding )p d)ring the proceeding year and a statement in the he prescribed form cotaining the prescribed partic)lars with respect to the position of the winding )p. (" If the li8)idator fails to comply with this section% he shall be liable to a fine not exceeding fi+e h)ndred ta2a. 0%&. 7inal meetin4 and dissolution.## !" As soon as the affairs of the company are f)lly wo)nd )p% the li8)idator shall ma2e )p an acco)nt of the winding )p showing how the winding )p has been cond)cted and the property of the company has been disposed of% and there)pon shall call a general meeting of the company and a meeting of the creditors% for the p)rpose of laying the acco)nt before the meetings and gi+ing any explanation thereof. (" Each s)ch meeting )nder s)b/section II" shall be called by ad+ertisement specifying the time% place and ob.ect thereof and p)blished one month at least before the meeting in the manner specified in s)b/section !" of section (A& for the p)blication of a notice )nder that s)b//section. 9" Within one wee2 after the date of the meetings% or% if the meetings% are not held on the same date% after the date of the later meeting% the li8)idator send to the Registrar a copy of the acco)nt% and shall ma2e a ret)rn to the him of the holding of the meetings and of their dates% and if the copies are not sent or the ret)rn is not made in accordance with this s)b//section% the day d)ring which the defa)lt contin)es: 1ro+ided that% if a 8)or)m% which for the p)rpose of the this section shall be two person% is not present at either of s)ch meetings the li8)idator shall% in lie) of s)ch ret)rn% ma2e a ret)rn that the meeting was d)ly s)mmoned and that no 8)or)m was present thereat% and )pon s)ch a ret)rn being made the pro+isions of this s)b/section as to the ma2ing of the ret)rn shall% in respect of that meeting be deemed to ha+e been complied with '" #he Registrar% on recei+ing the acco)nt and in respect of each s)ch meeting. '" #he Registrar on recei+ing the acco)nt and any of the ret)rns mentioned in s)b/section 9"% shall forthwith register them% and on the expiration of three months from the registation there of the company shall be deemed to be dissol+ed: 1ro+ided that the $o)rt may% on the application of the li8)idator or of any other person who appears to the $o)rt to be interested% ma2e an order deferring the date at which the dissol)tion of the company is to ta2e effect for s)ch time as the $o)rt thin2s fit. 3" It shall be the d)ty of the person on whose application an order of the $o)rt )nder s)b// section this '" is made% within twenty one days after the ma2ing of the of the order% to deli+er to the Register a certified copy of the order for registration% and if that person fails to do so% he shall be liable to fine not exceeding one h)ndred ta2e for e+ery day d)ring which the defa)lt contin)es. 8ene(al p(o9ision fo( 9olunta(y $indin4 up 0%6 . P(o9isions applicable to e9e(y 9olunta(y $indin4 up.## #he pro+isions contained in section 9B? to 9!'% both incl)si+e% shall apply to e+ery +ol)ntary winding )p whether a members or a creditors winding )p.

!(>

0%". /ist(ibution of p(ope(ty of company ## S)b.ect to the pro+isions of this Act as to preferential payments% the property of a company shall% on its winding )p% be applied in satisfaction of its liabilities pari pass) and% s)b.ect% to s)ch application% shall )nless the articles otherwise pro+ide% be distrib)ted among the members according to their rights and interested in the company. 0%8. Po$e(s and duties of liAuidato( in 9olunta(y $indin4 up.## !" #he li8)idator may// a" in the case of a members +ol)ntary winding )p with the sanction of an extraordinary resol)tion of the company% and in the case of a creditors7 +ol)ntary winding )p% with the sanction of either the co)rt or the committee of inspection% exercise any of the powers gi+e by cla)ses d"% e"% f" and h" o f section (>( to a li8)idator in a winding )p; b)t the exercise by the li8)idator of the powers gi+en by this cla)se shall be s)b.ect to the control of the $o)rt and any creditor or contrib)tory may apply to the $o)rt with respect to any exercise or proposed exercise of any of these powers; b" witho)t the sanction referred to in cla)se a"% exercise any of the other powers by this Act gi+en on the li8)idator in a winding )p by the $o)rt: c" exercise the power of the $o)rt )nder this Act of settling a list. of contrib)tories; and the list of contrib)tories; shall be prima facie e+idence of the liability of the persons named there in the be contrib)tories; e" s)mmon general meetings of the company for the p)rpose of obtain obtaining the sanction of the company by special or extraordinary resol)tion of for any other p)rpose he may thin2 fit. (" #he li8)idator shall pay the debts of the company and shall ad.)st the rights of the contrib)tories; among themsel+es. 9" When se+eral li8)idators are appointed% any power gi+en by this Act may be exercised by s)ch one or more of the them as may determined at the time of the appointment% or% in defa)lt of s)ch determination% by any n)mber not loss than two. 0%9. Po$e( of Cou(t to appoint and (emo9e liAuidato( in 9olunta(y $indin4 up## !" If% from any ca)se whate+er% % there is no li8)idator acting% the $o)rt may appoint a li8)idator. (" #he $o)rt may% on ca)se shown% remo+e a li8)idator and appoint another li8)idator% and% in case of s)ch remo+al shall immediately send a copy of the remo+al order to the remo+ed li8)idator. 01%. Notice by liAuidato( of his appointment.## !" #he li8)idator shall% with//in twenty one days after his appointment% deli+er to the Registrar for registration a notice of his appointment in the form prescribed. (" If the li8)idator fails to comply with the re8)irements of this section% he shall be liable to a fine not exceeding one h)ndred ta2a for e+ery day d)ring which the defa)lt contin)es. 011. A((an4ement $hen bindin4s on c(edtito(s.# Any arrangement entered into between a company abo)t to be% or in the co)rse of being% wo)nd )p and its creditors shall% s)b.ect to the right of appeal )nder s)b/section (" be binding on the company if sanctioned by an extraordinary resol)tion% and also on the creditors if acceded to by theree//fo)rths in n)mber and +al)e of the creditors.

!(?

(" Any creditor or contrib)tory may% within three wee2s from the completion of the arrangement% appeal to the $o)rt against it% and the $o)rt may there)pon% as it thin2s .)st% amend% +ary or confirm the arrangement. 01. Po$e( to apply to Cou(t to ha9e Auestions dete(mined of po$e(s e3e(cised.## !" #he li8)idator or any contrib)tory or creditor may apply to the $o)rt to determine any 8)estior arising in the winding )p of a company% or to exercise% as respects the enforcing of alls% staying of proceedings or any other matter all or any of the powers which the co)rt might exercise if the company were being wo)nd )p by the $o)rt. (" #he li8)idator or any creditor or contrib)tory may apply for an order settings aside any attachment% distress or exec)tion p)t into force against the estate or effects of the company after the commencement of the winding )p. 9" #he application )nder s)b/section (" shall be made// a" if the attachment% distress or exec)tion is le+ied or p)t into force by the High $o)rt 5i+ision% to thee High $o)rt 5i+ision: and b" if the attachment% distress or exec)tion is le+ied or p)t into force by any other $o)rt% to the $o)rt ha+ing .)risdiction to wind )p the company. '" #hee $o)rt% if satisfied that the determination of the 8)estion of the re8)ired exercise of power or the order applied for will be .)st and beneficial% may accede wholly or partially to the application on s)ch terms and conditions as it thin2s fit% or may ma2e s)ch other order on the application as it thin2s .)st. 010. Cost of 9olunta(y $indin4 up.## All costs% charges and other expendit)re properly inc)rred in the winding p)t incl)ding the rem)neration of the li8)idator% shall s)b.ect to the rights of sec)red creditors% if any% be payable o)t of the assets of the company in priority to all other claims. 014. Sa9in4 fo( (i4hts of c(edito(s and cont(ibuto(y.## #he winding )p of a company shall not bar the right of any creditor or contrib)tory to apply for a winding )p by the $o)rt% b)t in the case of an application by a contrib)tory the $o)rt m)st be satisfied that the rights of the contrib)tories will be pre.)diced by a +ol)ntary winding )p. 01&. Po$e( of Cou(t to adopt p(oceedin4 of 9olunta(y $indin4 up.## Where a company is being wo)nd )p +ol)ntary and an order is made for winding )p by the $o)rt% the $o)rt may% if it thin2 fit% by the same or s)bse8)ent order% pro+ide for the adoption of all or any of the proceedings in the +ol)ntary winding )p and also for any incidental on conse8)entan sit)ation. Eindin4 up sub>ect to supe(9ision of Cou(t 016. Po$e( to o(de( $indin4 up sub>ect to supe(9ision.## when a company has by special or extraordinary resol)tion% resol+ed to wind )p +ol)ntarily the $o)rt may ma2e an order that the +ol)ntary winding )p shall contin)e% b)t s)b.ect to s)ch s)per+ision of the $o)rt% and with s)ch liberty for creditors% contrib)tories; or other to apply to the co)rt and generally on s)ch terms and conditions as the co)rt thin2s .)st. 01" +ffect of petition fo( $indin4 up sub>ect to supe(9ision.## A petition for contin)ance of +ol)ntary winding )p s)b.ect to the s)per+ision of the $o)rt shall% for the p)rpose of gi+ing .)risdiction to the co)rt o+er s)its% be deemed to be petition for winding )p by the co)rt.

!(A

018. Cou(t may ha9e (e4a(d to $ishes of c(edito(s and cont(ibuto(ies.## #he $o)rt may% in deciding between a winding )p by the $o)rt and winding )p s)b.ect to s)per+ision% in the appointment of li8)idators% and all other matter relating to the winding )p s)b.ect to s)per+ision ha+e regard to the wishes of the creditors or contrib)tories; as pro+ed to it by any s)ffcient e+idence. 019. Po$e( of Cou(t to appoint and (emo9e liAuidato(s.## !" Where an order is made for a winding )p s)b.ect to s)per+ision% the $o)rt may by the same or any s)bse8)ent order appoint any additional li8)idator. (" A li8)idator appointed by the $o)rt )nder this section shall ha+e the same powers% be s)b.ect top the same obligations and in all respects stand the same position ad if he had been appointed by the company pay. 9" #he $o)rt may remo+ed any li8)idator so appointed by the $o)rt or any li8)idator contin)ed )nder der the s)per+ision order and fill and +acancy occasioned by the remo+al or by death or resignation. 0.%. +ffect of supe(9ision o(de(.## !" Where an order is made for a winding )p s)b.ect to s)per+ision% the li8)idator may% s)b.ect to any restrictions imposed by the $o)rt% exereise all this powers% witho)t the sanction or inter+ention of the $o)rt % in the same manner as if the company were being wo)nd )p altogether +ol)ntarily. (" Expect as pro+ided in s)b/section !" % and sa+e for the p)rposes of section (?&% any order made by the $o)rt for a winding )p s)b.ect to the s)per+ision of the $o)rt shall for all p)rposes% incl)ding the staying of s)its and other proceeding% be deemed to be an order of the co)rt for winding )p of the company by the $o)rt and shall confer f)ll a)thoritly on the $o)rt to ma2e calls or to enforce calls made by the li8)idators% and to exercise all other powers which it might ha+e exercise if an order had been made for winding )p the company altogether by the $o)rt. 9" In the constr)ction of the pro+ision whereby the $o)rt is empowered to direct any act or thing to be done to or in fa+o)r of the official li8)idator% the expression IIofficial li8)idator77 shall be deemed to mean the li8)idator cond)cting the winding )p s)b.ect to the s)per+ision of the $o)rt. 0.1. Appointment of liAuidato(s sub>ect to supe(9ision to the office of official liAuidato(s## Where an order has been made for the winding )p of a company s)b.ect to s)per+ision% and order is afterwards made for winding )p by the $o)rt% the $o)rt may% by the last//mentioned order or by any s)bse8)ent order% appoint the li8)idators for the first mentioned winding )p or any of them either pro+isionally or permanently% and wither with or witho)t the addition of any other person% to be official li8)idator in the winding )p by the $o)rt. Supplemental P(o9isions 0... A9oidance of t(ansfe(s, etc. afte( commencement of $indin4 up.## !" In the case of +ol)ntary winding )p% e+ery transfer of shares% except% transfers made to or with the sanction of the li8)idator% and e+ery alteration in the stat)s of the member of the company made after the commencement of the winding )p shall be +ied. (" In the case of a winding )p by or s)b.ect to the s)per+ision of the $o)rt% e+ery disposition of the property%% incl)ding actionable claims of the company% and e+ery transfer of shares% alteration in the stat)s of its members% made after the commencement of the winding )p shall the $o)rt otherwise orders be +oids.

!(&

0.0. /ebts of all desc(iptions to be p(o9ed.## In e+ery winding )p% s)b.ect in the case of insol+ent companies to the application in accordance with the pro+isions of this Act or the law of insol+ency% all debts payable on a contingency% and all claims against the company% present or f)t)re certain or contingency be admissible to proof against the company% a .)st estimate being made% so far as possible% of +al)e of s)ch debts or claims as may be s)b.ect to any contingency or for some other reason do not bear a certain +al)e. 0.4. Application of insol9ency (ules in $indin4 up of insol9ent companies.## In the winding )p of an insol+ency% all debts payable on a contingency% and all claims against the company% present or f)t)re% certain or contingent% shall be admissible to proof against the company% a .)st estimate being made % so far as possible% of +al)e of s)ch dbts or claims as may be s)b.ect to any contingency or for some other reasons do not bear a certain +al)e. 0.4. Application of insol9ency (ules in $indin4 up of insol9ent companies.## In the winding )p of an insol+ent company the same r)les shall pre+ial and be obser+ed with regard to the respecti+e eights of sec)red and )nsec)red creditors and to debts pro+able and the +al)ation of ann)ities and f)t)re and contingent liabilities as are in force for the time being )nder the law of insol+ents with respect to the estate of persons ad.)dged insol+ent; and all persons who in any s)ch case wo)ld be entitled to pro+ed for and recei+e di+idends o)t of the assets of the company may come in )nder the winding )p% and ma2e s)ch claims against the company as they respecti+ely are entitled to by +irt)e of this section. 0.&. P(efe(ential payments.## !" In a winding )p there shall be paid in priority to all other debts// a" all re+en)e% taxes% cesses and rates% whether payable to the *o+ernment or to a local a)thority d)e from the company at the date% specified in s)b//section 3"% hereinafter referred in this s)b//section as the said date and ha+ing become d)e and payable Within the twel+e months next before the said ate; b" all wages or salary of any cler2 and other ser+ant in respect of ser+ice rendered to the company within the two months next before the said date% not exceeding one tho)sand ta2a for each cler2 or ser+ant; c" all wages of any labo)rer or wor2man% not exceeding fi+e h)ndred for each% whether payable for the time or piece//wor2% in respect of ser+ices rendered to the company within the two months next before the said date: d" compensation payable )nder the Wor2men7s $ompensation Act% !&(9 EIII of !&(9"% in respect of the death or disablement of any officer or employee of the company; and f" the expenses of any in+estigation held in p)rs)ance of cla)se c" of section !&3 of this Act. (" thee debts mention din s)b/section !" shall// a" ran2 e8)ally among themsel+es and be paid in f)ll % )nless the assets are ins)fficient to meet them% in case they shall abate in e8)al proportion; and b" so far as the assets of the company a+ailable for payment of general creditors are ins)fficient to meet them% ha+e priority o+er the claims of holders of debent)res )nder any floating charge created by the company and be paid accordingly o)t of any property comprised in or s)b.ect to that charge.

!9B

9" S)b.ect to the retention of s)ch s)ms as may be necessary for the costs and expenses of the winding )p% the foregoing debts shall be discharged forth with so far as the assets are s)fficient to meet them. '" In the e+ent of any person distraining or ha+ing distrained on nay goods or effects of the company within three months next before the date of a winding )p order% the debts to which priority is gi+en by this section shall be a first charge on the good or effects so distrained on the proceeds of the sale thereof: 1ro+ided that in respect of any money paid )nder any s)ch charge thee said persons shall ha+e the same rights or priority as the person to whom the pay 3" #he date referred to in s)b/section !" a" is// a" in the case of a company ordered to be wo)nd )p comp)lsorily which had not pre+io)sly commenced to be wo)nd )p +ol)ntarily the date of the winding )p order; and b" in any other case% the date of the commencement of the winding )p. 0.6. disclaime( of p(ope(ty.## !" Where any part of the property of company which is being wo)nd )p consists of land of any ten)re b)rdened with onero)s con+enants% of shares% or stoc2 in other companies% of )nprofitable contracts or of any other property that is )nsalable% or not readily saleable% by reason of its binding the possesses there of the performance of any onero)s act% or to the payment of any s)m of money% the li8)idator of the company% nontwithstanding that he had endea+ored to sell or has ta2enpossession of the property% or had excised any act of ownership in relation thereto% may with the lea+e of the $o)rt and s)b.ect to the pro+isions of this the commencement of the winding )p or s)ch extended poriod as may be allowed by the $o)rt disclaim the property: 1ro+ided that% where any s)ch property has not come to the 2nowledge of the li8)idator within one months after the commencement of the winding )p% the power )nder this section of disclaiming the property may be exercised at any time within twel+e months after he has become aware thereof or s)ch extended period as may be allowed by the $o)rt. (" #he disclaimer shall operate to determine% as from the date of disclaimer% the rights% interest% and liabilities of the company% and the property of the company% in or in respect of the property disclaimed% b)t shall not% except so far as is necessary for the p)rpose of releasing the company and the property of the company from liability affect the rights or liabilities of any other person. 9" #he $o)rt% before or on granting lea+e to disclaim% may re8)ire s)ch notice to be gi+en to persons interested and imposed s)ch terms as a condition or granting lea+e% and ma2e s)ch other order in the matter as the $o)rt thin2s .)st. '" #he li8)idator shall not be entitled to disclaim any property )nder this section in any case where an application writing has been made to him by nay persons interested in the property re8)iring him to decide whether he will or will not disclaim and the li8)idator has not within a period of thirty days after he receipt of the application or s)ch f)rther time as may be allowed by the $o)rt % gi+en notice to the applicant that he intends to apply to the $o)rt for lea+e to disclaim% and in the case of a contract% if the li8)idator% after s)ch an application as aforesaid% does not with the said period or f)rther period disclaim the contract% the company shall be deemed to ha+e adopted it.

!9!

3" #he $o)rt may% on the application of any person who is% as against the li8)idator% entitled to the benefit or s)b.ect to eh b)rden of a contract made with the company% ma2e an order rescinding the contract on s)ch terms as to payment either party of damages for the nonperformance of contract% or otherwise as the $o)rt thin2s .)st % and any damages payable )nder the order to any s)ch person may be pro+ed by him as debt in the winding )p. >" the $o)rt may% on an application by any person who wither claims any interest in any disclaimed property or is )nder any liability not discharged by this Act in respect of any disclaimed property and or hearing any s)ch persons as it thin2s fit% ma2e an order for the +esting of the properly in or seem .)st that the peoperty sho)ld be deli+ered by way of compensation for s)ch liability as aforesaid% or a tr)stee for him and on s)ch terms as the $o)rt thi2s .)st; and on any s)ch +esting order being made% the property comprised therein shall +est accordingly in the person therein named in that behalf witho)t any con+eyance or as signment for the p)rpose:// 1ro+ided that% where the property disclaimed is of a leasehold nat)re% the $o)rt shall not ma2e a +esting order in fa+o)r of any person claiming )nder the company whether as )nder//lessee or as mortgagee expect )pon the terms of ma2ing that person// a" S)b.ect the same liabilities and obligations as those to which the company was s)b.ect )nder the lease or mortgage in respect of the property at the commencement of the winding )p; or b" if the $o)rt thin2s fit% s)b.ect only to the same liabilities and obligations as if the lease had been assigned to that person at that date; and in either% if the case so re8)ires% as if the lease had comprised only the property comprised in +esting order% and any mortgagee or )nder lease declining to accept a +esting order )p on s)ch terms hall be excl)ded all interest in and sec)rity )pon the property% and if there is not person claiming )nder the company who is willing to accept and order )pon s)ch terms% the $o)rt shall ha+e power to +est the estate and intr)st of the company in the property in any person liable% either personally or in representati+e% and either alone or .ointly with company% to perform the lessee7s con+enants in the lease % freed and discharged from all estates% inc)mbranees and interests created therein by the company. ?" any person in.)red by the operation of disclaimer )nder this section shall be deemed to be a creditor of the company to the amo)nt of the in.)ry% and may accordingly pro+e the amo)nt as a debt in the winding )p. 0." 7(audulent p(efe(ence.## !" Any transfer% deli+ery of goods% payment% exec)tion or other act relating to property which wo)ld% if made or done by or against an indi+id)al be deemed in his insol+ency a fra)d)lent preference% shall is made or done by or against a company% be deemed and in+alid accordingly. (" :or the p)rpose of this section% the presentation of a petition for winding )p in the case of winding )p by or s)b.ect to the s)per+ision of the $o)rt % and a resol)tion for winding )p in the case of a +ol)ntary winding )p% shall be deemed to correspond with the act of insol+ency in the case of an indi+id)al.% 9" Any transfer or assignment by a company of all its property to tr)stees for the benefit of all its creditors shall be +oid. 0.8. A9oidance of ce(tain attachments, e3ecutions, etc.## !" Where any company in s being wo)nd )p by or s)b.ect to the s)per+ision of the $o)rt% any attachment% distress or exec)t)on p)t in force witho)t lea+e of the $o)rt against the estate or effects or any sale held witho)t lea+e of

!9(

the $o)rt of any properties of the company after the commencement off the winding )p shall be +oid. (" 4othing in this section applies to proceedings by the *o+ernment. 0.9. +ffect of cha(4e c(eated afte( commencement of $indin4 up## A floating charge on the )nderta2ing or property of the company created with in ninety day of commencement of the winding )p shall )nless it is pro+ed that the company immediately mediately after the creation of the charge was sol+ent % be in+alid except top the amo)nt of any cash paid to the company at the time of or s)bse8)ently to the creation of % and in consideration for the charge% together with interest on the amo)nt at the rate of fi+e per cent% per ann)m. 00% 8ene(al scheme of liAuidation may be sanctioned. ## !" #he li8)idator may with the sanction of the $o)rt when the $o)rt or s)b.ect to the s)per+ision of the $o)rt% and with the sanction of an extraordinary resol)tion of the company in the case of a +ol)ntary winding )p% do the following things or any of them:// i" pay to any classes of creditor in f)ll; ii" ma2e any compromise or arrangement with creditors or persons claiming to be creditors or alleging themsel+es to ha+e any claim% present or f)t)re% whereby the company may be rendered liable; iii" compromise all calls and liabilities to calls% debts and liabilities% capable of res)lting in debts% and all claims% present or f)t)re% certain or contingent% s)bsisting or s)pposed to s)bsist between the company and a contrib)tory or alleged contrib)tory or other debtor or person apprehending liability to the company% and all 8)estions in any way relating to or affecting the assets or the winding )p of the company% on s)ch terms as may be agreed% and ta2e any sec)rity for the discharge of any s)ch call debt% liability or claim% and gi+e a complete discharge in respect thereof. (" #he exercise by the li8)idator of the powers )nder this section shall be s)b.ect to the control of the $o)rt and any creditor or contrib)tory may apply to the $o)rt with respect to any exercise or proposed exercise of any these powers. 001. Po$e( of Cou(t to assess dama4es a4ainst delinAuent di(ecto(, etc.## !" Where% in the co)rse of winding )p a company in appears that nay person who has ta2en part in the formation or promotion of the company or any past or present director% manager or li8)idator% or any officer of the company properly of the company% or been g)ilty of misfeaFance or breach of tr)st in relation to the company the $o)rt may% on the application of the li8)idate or of any creditor or contrib)tory made within three years from the date of the first appointment of a li8)idator in the winding )p or of the miFapplication% retainer FFsfeaLance of li8)idator in the winding )p or of the misapplication% retained misfeaFance or breach of tr)st% as the case may be whiche+er is longer examine of the cond)ct of the promoter% director manage li8)idate or office and may compel him to repay or restore the money or property or any partnered of respecti+ely with interest at s)ch rate as the $o)rt thin2s .)st% or to contrib)te s)ch s)m to the assets of the company by way of compensation in respect of the misapplication% retainer% misfeasance or breach or tr)st% as the $o)rt thin2s .)st. (" #his section shall apply notwithstanding that offence is one for which the offender many criminally prosec)ted. 00.. Penalty fo( falsification of boo<.##In any director% manager% officer or contrib)tory of any company being wo)nd )p destroys% m)ltilates% alters of falsifies or fra)d)lently secrets any boo2s

!99

papers or sec)rities or ma2es or is pri+y to the ma2ing of any false or fra)d)lent entry in any register boo2 of acco)nt or doc)ment belonging to the company with intent to defFa)d or decei+e any person% he shall be liable to imprisonment for a term which may extend to se+en years% and shall also be liable to fine. 000 P(osecution of delinAuent di(ecto(s.## !" If it appears to the $o)rt in the co)rse of a winding )p by% or s)b.ect to the s)per+ision of the $o)rt that an past or present director% manager or other officer% or any member of the company has been g)ilty of any offence in relation to the company for which he is criminally liable the $o)rt may either on the application of any person intr)sted in the winding )p of its own motion% direct the li8)idate wither himself to p<prosec)te the offender or to refer the matter to the Registrar. (" If it appears to the li8)idator in the co)rse of +ol)ntary winding )p that nay past or present director% manager of other offence or any member of the company has been g)ilty of any offence in relation to the company for which he is criminally liable he shall forth with report the matter to the Registrar and shall f)rnish to him s)ch information and gi+e it him s)ch access to and facilities for inspecting and ta2ing copies of any doc)ments being% information or doc)ment in the possession or )nder the control of the li8)idator relating to the matter in 8)estion% as he may re8)ire. 9" Where any report is made )nder s)b//section (" to the Registrar% he may if he thin2s fit% refer the matter to the *o+ernment for f)rther in8)iry% and the *o+ernment shall there)pon in+estigate the matter and may if they thin2 it expedient% apply to the $o)rt for an order conferring on any person designated by the *o+ernment for the p)rpose with respect to the company concerned all s)ch powers of in+estigating the affairs of the company as are pro+ided by this Act in the case of a winding )p by the $o)rt. '" If on any report to the Registrar )nder s)b//section (" it appears to him that the case is not one in which proceeding o)ght to be ta2en by him% he shall inform the li8)idator accordingly% and there)pon% s)b.ect to the pre+io)s sanction of the $o)rt% the li8)idator may himself ta2e proceedings against the offender. 3" It it appears to the $o)rt in the co)rse of a +ol)ntary winding )p that any past or present director% manager or other officer or any member of the company has been g)ilty as aforesaid% and that no report with respect to the matter has been made by the li8)idator tot he Registrar% the $o)rt may% on the abolition of any person interested in the winding )p or of its won motion% direct the li8)idator to ma2e s)ch a report% and on a report being made accordingly% the pro+ision of this action shall ha+e effect as tho)gh the report as been made in p)rs)ance of the pro+ision of s)b/ section (". >" If a matter is reported or referred to the Registrar )nder this section and considers that prosec)tion o)ght to be instit)ted there on% he shall place the papers before the Attorney *eneral or the p)blic prosec)tor and shall if ad+ised to do so% instit)te proceedings : 1ro+ided that no prosec)tion shall be )nderta2e witho)t first gi+ing the acc)rsed person an opport)nity of ma2ing a statement in writing to the Registered and of being headed thereon. ?" 4otwithstanding anything contained in the E+idence Act% !A?( ! of !A?("% when any proceedings are instit)ted )nder this section it shall be d)ty of the li8)idator and of e+ery officer and agent of the company past and present other than the defendant in the proceedings% to gi+e all assistance in connection with the prosec)tion which he is reasonably able to gi+e% and for the p)rposes of this s)b//section the expression 0agent77 in relation to a company shall be deemed to incl)de any ban2er or legal ad+iser if the company and any person employed by the company as a)ditor% whether that person is or is not an officer of the company.

!9'

A" If any person fail or neglects to gi+e assistance in manner re8)ired by s)b/section ?"% the $o)rt may on the application of the Registrar direct that person to comply with the re8)irements of the said s)b/section% and where any s)ch application is made with respect to a li8)idator% the $o)rt may )nless it appears that the fail)re on neglect to comply was d)e to the li8)idator not ha+ing in his hands s)fficient assets of the company to enable him so to do direct that the costs of the application shall be borne by the li8)idator personally. 004. Penalty fo( false e9idence5## If any person% )pon any examination a)thorised )nder this Act% or in any affida+it% depositing or solemn affirmation% in or abo)t the winding )p of any company )nder this Act% or otherwise in or abo)t any matter arising )nder this Act intentionally gi+e false e+idence% he shall be liable to improisonment for a term which may extend to se+en years% and shall also be liable to find. 00&. Penal p(o9isions## !" If any person% being a past or present director% managing agent manager or other officer of a company which at the time of the commission of the alleged offence is being wo)nd )p in any manner.// a" does not to the best of his 2nowledge and belief f)lly and tr)ly disco+er to the li8)idator all the property% mo+eable and immo+able of the company% and how and to whom and for what consideration part as has been disposed of in the ordinary way of the b)siness of the company% or b" does not deli+er )p to the li8)idator% or as he directs all s)ch part of mo+able and immo+able property of the company as in this c)stody or )nder hiscontrol% and which he is re8)ired by law to deli+er% or c" does not deli+er to the li8)idator% or as the directs all boo2s and papers on his c)stody or )nder his control belonging to the company and which he is re8)ired by law to deli+er% or d" with in twel+e months next before the commencement of the winding )p or at any time thereafter% conceals anypart of the property of the company to the +al)e of one h)ndred ta2a or )p wards or conceals any debt to or from the company% or e" within twel+e months nest before the commenement of the winding )p or at any time thereafter fra)d)lently remo+e any part of the property of the company to the +al)e of one h)ndred ta2a or )pwards% or f" ma2es an material omission in any statement relating to the affairs of the company or g" 2nowing or belie+ing that a false debt has been pro+ed by any person )nder winding )p% fails within the period of a month to inform the li8)idator thereof% or h" after the commencement of the winding )p pre+ents the prod)ction of any boo2 or paper affecting or relating to the property or affairs of the company% or i" within twel+e months next before the commencement of the winding )p or any time thereafter% conceals destroys% m)tilates or falsifies% or is pri+y to the concealment% destr)ction% m)tilation or falsification of any boo2 or paper affecting or relating to the property or affairs of the company or

!93

." within twel+e months next before the commencement of the winding )p or at any time thereafter ma2es or is pri+y to the ma2ing of any false entry in any boo2 or paper affecting or relating to the property or affairs of the company% or 2" within twel+e months next before the commencement of the winding )p or at any time thereafter fra)d)lently parting with altering or ma2ing any omission any doc)ment affecting or relating to the property or affairs of the company% or l" after commencement of the winding )p or at any meeting of the creditors of the company within twel+e months next before the commencement of the winding )p % attempts to acco)nt for any part of the property of the company by fictitio)s losses or expenses% or m" within twel+e months next before the commencement of the winding )p or at any time thereafter any false representation or other fra)d% obtained any property for or on behalf of the company on credit which the company does not s)bse8)ently pay or n" within twel+e months next before the commencement of the winding )p or at any time thereafter% )nder the false pretence that the company is carrying on its b)siness% obtains on credit% for or on behalf of the company any property which the company does not s)bse8)ently pay for% or o" within twel+e months next before the commencement of the winding )p or at any time thereafter pawns% pledges% or disposes of any property of the company which s)ch pawning pledging or disporting is in the ordinary way of the biasness of the company% or p" is g)ilty of any false representation or other fra)d for the p)rpose of obtaining the consent of the creditors of the company or any of them to an agreement with reference to the affairs of the company or to the winding )p. he shall p)nishable% in the case of the offence mentioned in cla)ses m" n" and o" with imprisonment for a term not exceeding se+en years%% and in the case of any offence% mentioned in other cla)ses with imprisonment for a term not exceeding tow years: 1ro+ided that it shall be a good defence to a charge )nder any of cla)ses b"% c"% d"% f"% n"% and o" if the acc)sed pro+es that he had no intent to defra)d% and to a charge )nder any of the cla)ses a" h" i" and ." if he pro+es that he had no intent to conceal the state of affairs of the company or to defeat the law. (" Where any person pawn% pledges or disposes of any property in circ)mstances which and amo)nt to an offence )nder cla)se o" of s)b/section !"% e+ery person who ta2es in pawned% pledged or disposed of in s)ch circ)mstances as aforesaid shall be p)nishable with imprisonment for a term not exceeding three years. 006. 'eetin4 to asce(tain $ishes of c(eato(s o( cont(ibutions. !" where by this Act the $o)rt is a)thori-ed in relation to winding )p ha+e regard to the wishes of creditors or contrib)tors%% as pro+ed to it by any s)fficient e+idence% the $o)rt may if it thin2s for the p)rpose of ascertaining those wishes% direct meetings of the creditors or contrib)tors to be called% held and cond)cted in s)ch manner as the co)rt direct and may appoint a person to act as $hairman of any s)ch meeting and to report the res)lt therefor the $o)rt. (" In the case of creditors% regard shall be had to the +al)e of each creditors debt.

!9>

9" In the case of contrib)tories regard shall be had to n)mber of +otes conferred on each contrib)tory by the articles. 00". +9identially 9alue of documents of company## Where any company is being wo)nd )p% all doc)ments of the company and of the li8)idator shall as between the contrib)tors of the company% be prima/facie e+idence of the tr)th of all matters p)rporting to therein recorded. 008. *nspection documents.## After and order for a winding )p by or s)b.ect to the s)per+ision of the $o)rt the $o)rt may ma2e s)ch order for in pectin creators and contrib)tors% of the company of its doc)ments as the $o)rt thin2s .)st% and any doc)ments in the possession of the company may be inspected creditors or contrib)tors accordingly b)t not % f)rther or otherwise. 009. disposal of document of company5## !" when a company has been wo)nd )p and is abo)t to be dissol+ed the doc)ments of the company and of the li8)idator any be disposed<hosed of a follows% that is to say:// a" in the case of a winding )p by or s)b.ect ,# the s)per+ision of the $o)rt% in s)ch way as the $o)rt directs; b" in the case of +ol)ntary winding )p% in s)ch way as the company by extraordinary resol)tion directed. (" After three years from the dissol)tion of the company no responsibility shall rest on the company of the li8)idators% or any person to whom the c)stody of the doc)ments has been committed% by reason of the same not being forthcoming to any person claiming to be interested therein. 04% Po$e( of Cou(t to decla(e dissolution of comma 9oid5 ## !" Where a company has been dissol+ed% the $o)rt may% at any time within two years of the date of the dissol)tion on an application being made for the p)rpose by li8)idator of the company or by any other person who appears to the $o)rt to be interested ma2e an order )pon s)ch terms as the $o)rt to the $o)rt to be interested% ma2e an order )pon s)ch terms as the $o)rt thin2s fit% declaring the dissol)tion to ha+e been +oid% and there)pon s)ch proceedings may be ta2en as might ha+e been ta2en if the company had not been dissol+ed. (" It shall be the d)ty of the person on whose application the order was made% within twenty/one days after ma2ing of the order% to file with the Registrar a certified copy of the order% and if that person fails so to do% he shall be liable to a fine not exceeding one h)ndred ta2a for e+eryday d)ring which he defa)lt contin)es. 041 *nfo(mation as to pendin4 liAuidations 5 !" where a company is being wo)nd )p% if the winding )p is not concl)ded//one year after its commencement the li8)idate% shall% once a year and at inter+als of not more that twel+e months )ntil the winding )p is concl)ded% file in the $o)rt or with the Registrar% as the case may be statement in the prescribed form and containing the prescribed partic)lars with respect to the proceeding in and the position of the li8)idation. (" Any person stating himself in writing to be a creditor or contrib)tory of the company shall be entiled% by himself or by his agent% at all reasonable time% on payment of the prescribed fee% to inspect the statement and to recei+e a copy thereof or extract therefrom; b)t any person )ntr)thf)lly so stating himself to be a creditor or contrib)tory shall be deemed to be g)ilty of an offence )nder section !A( of the 1enal $ode DCE of !A>B" % and shall be p)nishable accordingly on the application of the li8)idator.

!9?

9" If a li8)idator fails to comply with the re8)irements of this section% he shall be liable to a fine not exceeding one tho)sand ta2a for each day d)ring which the defa)lt contin)es. '" When the statement is filed in $o)rt% a copy shall sim)ltaneo)sly be filed with the Registrar and shall be 2ept by him along with other records of the company. 04.. Payment of liAuidato( into ban<5## !" E+ery li8)idator of a company which is being wo)nd )p by the $o)rt shall in s)ch manner and at s)ch times as may be prescribed% pay the money recei+ed bn him in to a sched)led tan2s as defined in the 6angladesh 6an2 ,rder% !&?( 1.,. 4o. !(? of !&?(": 1ro+ided that if the $o)rt is satisfied that for the p)rpose of carrying on the b)siness of company or obtaining ad+ances or for any other reason it is for the ad+antage of the creditors or contrib)tors that the li8)idator sho)ld ha+e an acco)nt with any other ban2% the $o)rt may a)thori-ed the li8)idator it ma2e his payment into or o)t of s)ch other ban2 as the $o)rt may select and there )pon those payments shall be made in the prescribed manner. (" It any li8)idator at any time retains for northern !B day7s s)m exceeding fi+e h)ndred ta2a or s)ch other amo)nt as the $o)rt any in any partic)lar case a)thoresses him to retain the )nless he explains the retention in excess all the rate of twenty per cent ann)m and shall be liable to disallowance of all or s)ch part of his rem)neration as the $o)rt may thin2 .)st and to be remo+ed from his office by the $o)rt and shall be liable to pay any expenses occasioned by reason of his defa)lt. 9" A li8)idator of a company which is being wo)nd )p shall open a special ban2ing acco)nt and pay all s)ms recei+ed by him a li8)idator into s)ch acco)nt. 040. 2nclaimed di9idend and undist(ibuted assets to be paid to Combines ,iAuidation Account5 ## !" Where any company is being wo)nd )p% if the li8)idator has in his hands or )nder his control any money of the company presenting )nclaimed di+idends payable to any creditor or )ndistrib)ted asset ref)ndable to any contrib)tory which ha+e remained )nclaimed for one h)ndred and eighty days after the date on which they become payable or ref)ndable that li8)idation shall forthwith pay the said money into the 6angladesh 6an2 to the credit of the *o+ernment in an acco)nt to be called the $ompanies Ci8)idation Acco)nt0 and the li8)idator shall on the dissol)tion of the company% similarly pay into the said acco)nt any money representing )nclaimed di+ided or )ndistrib)ted assets in his hand at the date of dissol)tion. (" the li8)idator shall% when ma2ing any payment referred to in s)b section !" f)rnish to s)ch officer as the *o+ernment may appoint in this behalf a statement in prescribed form setting forth in respect of all s)m incl)ded in s)ch payment the nat)re of the s)ms% the names and last 2now addressed of the persons entitled to participate therein% the amo)nt to which each is entitled and the nat)re of his claim thereto% and s)ch other partic)lars as may be prescribed. 9" the receipt of the 6angladesh 6an2 for any money paid to it )nder s)b/section !" shall be an effect)al discharge of the li8)idator in respect thereof. '" where the company is being wo)nd by the $o)rt the li8)idator shall ma2e the payment referred to in s)b/section !" by transfer from the special ban2ing acco)nt referred to in s)b/ section 9" of section 9'(% and where the company is being in wo)nd )p +ol)ntarily or s)b.ect ,# the s)per+ision of the $o)rt the li8)idator shall when filing a statement it p)rs)ance of s)b/ section !" of section 9'!% indicate the s)m to money which is payable to the 6angladesh 6an2 )nder s)bsection !" of this section which he has had in his the dat to which the said statement is

!9A

bro)ght down% and shall% within fo)rteen days of the date of filing the said statement% pay that s)m into the $ompanies Ci8)idation Acco)nt. 3" Any person claiming to be entitled to any money paid into the $ompanies Ci8)idation Acco)nt in p)rs)ance of this section may apply to the co)rt for an order for payment thereof% and the $o)rt% if satisfied that the person claiming is entitled may ma2e an order for the payment ,# that person of the s)m or the asset d)e to him; 1ro+ided that before ma2ing s)ch order the $o)rt shall ca)se a notice to be ser+ed on s)ch officer as the *o+ernment any appoint in this behalf calling on the officer to show ca)se within thirty days from the dat of the ser+ice of the notice why the order sho)ld not be made. >" Any money paid into the $ompanies Ci8)idation Acco)nt is p)rs)ance of this section% which remains )nclaimed thereafter for a period of fifteen years% shall be transferred to the general re+en)e acco)nt of the *o+ernment; b)t any claim preferred )nder s)b/section 3" any money or asset to transferred shall be allowable as if s)ch transfer had not been made% the order for payment on s)ch claim being treated as an order for ref)nd of re+en)e. ?" Any li8)idator retaining any money or asset which sho)ld ha+e been deposited by him into the $ombines Ci8)idation Acco)nt )nder this section shall pay interest on the amo)nt retained at the rate of twenty percent ann)m and shall also be liable to pay any expense occasioned by reason of his defa)lt and where the winding )p is by or )nder the s)per+ision of the $o)rt% he shall also be liable to disallowance of all or s)ch part of his rem)neration as the $o)rt may thin2 .)st and to be remo+ed from this office by the co)rt. A" :or the p)rposes of this section% the li8)idator may with the sanction of the $o)rt or as the case may be% of the *o+ernment% sello)t the )ndistrib)ted asset referred to in s)b/section !" and deposit the sale proceed in the company7s Ci8)idation Acco)nt and it may be accordingly be disposed )nder this section. 044. Cou(t o( pe(son befo(e $hom affida9it may be s$o(n5## !" Any affida+it re8)ired to be sworn in 6angladesh before any $o)rt% K)dge or person lawf)lly a)thori-ed to ta2e and recei+e affida+it or in any place o)tside 6angladesh before a 6angladesh $ons)l or Eic/$ons)l. (" All $o)rt K)dges% K)stices% $ommissioners% and persons acting .)dicially in 6angladesh shall ta2e .)dicial notice of the seal or stamp or signat)re as the case% may be% of any s)ch $o)rt K)dge% person% $ons)l or Eice/$ons)l% $ons)l attached% appended or s)bscribed to any s)ch affida+it or to any other doc)ment to be )sed for the p)rposes of this part. 2,+S 04&. Po$e( of Sup(eme Cou(t to ma<e (ules5## !" #he S)perme $o)rt may from time to time% ma2e r)le consistent with the $ode of $i+il proced)re !&BA Act of !&BA" concerning the following matters namely:// a" the mode of proceedings to be held for winding )p of company in the High $o)rt 5i+ision and in a co)rt s)bordinate thereto. b" in the case of +ol)ntary winding )p by members or creditors% for the holding of meetings of creditors and members in connection with proceedings )nder section ((A of this Act;

!9&

c" gi+ing effect to the pro+ision of this Act for the p)rpose of red)ction of share capital and s)b/di+ision of the shares of a company; d" all applications to be made to the $o)rt )nder the pro+ing of this Act. (" #he $o)rt shall ma2e r)les pro+iding for all matters which by this Act% are re8)ired to be prescribed. 9" witho)t pre.)dice to the generality of the foregoing power the S)preme $o)rt may s)ch r)les enable or re8)ire all or any of the powered and d)ties conferred and imposed on the $o)rt by this Act in respect of the matter following to exercised or performed by the say the powers and d)ties of the $ontrol in respect of/ a" holding and cond)cting meetings to ascertain the wishes of creditors and contrib)tories ; b" Settling list of contrib)tors and rectifying the register of members where re8)ired% and collecting and applying the assets of the company c" re8)iring deli+ery of property or doc)ments to the li8)idator; d" ma2ing calls; e" fixing a time within which debts and claims m)st be pro+ed. 1ro+ided that the official li8)idator shall not witho)t the special lea+e of the $o)rt% rectify the register of members% and shall not ma2e any call witho)t the special lea+e of the $o)rt. emo9al of defunct Companies f(om e4iste(.

046. e4ist(a( may st(i<e defunct company off e4ist(a(5## !" where the Registrar has reasonable ca)se to belie+e that a company is not carrying on b)siness or in operation% he shall send to the company by post a letter in8)iring whether the company is carrying on b)siness or in operation; (" If the Registrar does not within thirty days of sending the letter recei+e any answer thereto% he shall within fo)rteen days% after the expiration of the said thirty days send to the company by post a registered letter referring to the first letter and stating that no answer thereato has been recei+ed and that if an answer is not recei+ed to the second letter with thirty days from the date% thereof% a notice will be p)blished in the official *a-ette with a +iew to stri2ing the name of the company off the register; 9" If the Registrar either recei+es an answer from the company to the effect that it is not carrying on b)siness or in operation% or not within thirty days after sending the second letter recei+e any answer% he may p)blish in the ,fficial *a-ette and send to the company by post a notice that at the expiration of ninety days from the date of that notice% the name of the company mentioned therein will% )nless ca)se is shown to the contrary% be str)c2 off the register and the company will be dissol+ed and in s)ch a case the Registrar may send a copy of the notice to the company while in sending it to the concerned a)thority for its p)blication official *a-ette; '" If% in any case where a company is being wo)nd )p% the Registrar has reasonable ca)se to belie+e either that no li8)idator is acting or that the affairs or the company are f)lly wo)nd )p and the ret)rns re8)ired to be made by the li8)idator ha+e not been made for a period of six

!'B

consec)ti+e months after notice by the Registrar demanding the ret)rns% has been sent by post to the company or to the li8)idator at his last 2nown place of b)siness% the Registrars may p)blish in the official *a-ette and sent to the company a li2e notice as is pro+ided in the s)b/section 9"; 3" At the expiration of the time mentioned in the notice the Registrar may )nless ca)se to the contrary is pre+io)sly shown by the company% stri2e its name on the register and on the he p)blication in the official *a-ette of a notice to the effect the company shall be dissol+ed: 1ro+ided that the liability% if any% of e+ery director and member of the company shall contin)e and may be enforced as if the company had not been dissol+ed. >" If a company or any member or creditor thereof feels aggrie+ed by the company ha+ing been str)c2 off the register% the $o)rt on the application of the company or member or creditor% may if satisfied that the company was at the time of the stri2ing off carrying on b)siness or in operation or other wise that it is .)st that the company be restored% to the register% and there)pon the company shall be deemed to ha+e contin)ed in existence as its name had not been str)c2 off; and the $o)rt may by order gi+e s)ch directions and ma2e s)ch pro+isions as seem .)st for placing the company and all other persons in the same positions as nearly as may be as if the name of the company has not been str)c2 off; ?" A letter or notice )nder this section may be addressed to the company at its registered office% or if no office has been registered% to the care of some director% manger or other officer of the company or% if there is no director% manger or other officer of the company whose named and address are 2nown to the registrar s)ch letter or notice may be sent to each of the persons who s)bscribed the memorand)m% at the address mentioned in the memorand)m.

PA T ?* +8*ST AT*!N !77*C+ AN/ 7++S

04". e4ist(ation office## !" :or the p)rposes of the registration of $ompanies )nder this Act% there shall be central office and original office at s)ch places as the *o+ernment thin2 % fit and company shall be registered except at an office within the territorial .)risdiction in which by the memorand)m% the registered office of the company is declared to be e established. (" #he *o+ernment may appoint s)ch Registrar% Additional Registrar% and Assistant Registrar as it thin2s necessary for the registration of companies )nder this Act and may ma2e reg)lation r)le with respect of their d)ties. 9" #he Salaries of the persons appointed )nder this section shall be fixed by the *o+ernment. '" the *o+ernment may direct as seal or seals to be prepared for the a)thentication of doc)ments re8)ired for or connected with the registration companies. 3" any person may inspect the doc)ments 2ept by the Registrar on payment of s)ch fees as may be specified by the *o+ernment not exceeding the fees specified in Sched)le III for each inspection; and any person may re8)ire of any company or a copy or extract of any other doc)ment or any part of other doc)ment%% to be certified by the Registrar on payment for the certificate certified copy or extract of s)ch fees as the *o+ernment may specify not exceeding the fee specified in the said Sched)le. !'!

>" Whene+er any act is by this Act directed to be done to or by the Registrar it shall )ntil the *o+ernment otherwise direct be done to or by the case of the central office the existing Registrar or in his absence ,# or by s)ch person as the *o+ernment may for the time being a)thoress and in the Koint Registrar or 5ep)ty Registrar or Assistant Registrar as is appointed as the $hef ,fficer of that office. 048. 7ees.## !" #here shall be paid to the Registrar in repect of the se+eral matters mentioned in Sched)le II the se+eral fees therein specified% or s)ch smaller fees as the *o+ernment may direct. (" All fees paid to Registrar in p)rs)ance of this Act shall be acco)nted for the *o+ernment. 049. +nfo(cin4 submission of (etu(ns and documents to e4ist(a(5 # !" If a company% ha+ing made defa)lt in complying with any pro+ision of this Act% which re8)ires it to file with% deli+er or send to the Registrar any ret)rn acco)nt or other doc)ment% or to gi+e notice to him of any matter fails to ma2e good the defa)lt within fo)rteen days after the ser+ice of a notice on the company re8)iring it to dos so% the $o)rt may on an application made to the $o)rt by member or creditor of the company or by Registrar% ma2e an order directing the company and officer thereof to ma2e good the defa)lt within s)ch time as may be specified in the order. (" Any s)ch order may pro+ide that all costs of and incidental to the application shall be borne by the company or the concerned officer in respect of any s)ch defa)lt as aforesaid. 9" 4othing in this section shall be ta2en to p<pre.)dice the operation of any then enactment imposing penalties on a company or its officers in respect of any s)ch defa)lt as aforesaid.% 0&%. 7illin4 o( (e4ist(ation of documents, etc, afte( the time specified5 # Any doc)ments or ret)rn by this Act re8)ired or a)thori-ed to be file or registered or any fact by this Act re8)ired or a)thori-ed to be registered with the Register on payment of fees specified therefore in Sched)le II any witho)t pre.)dice to any other labilities be filed or registered after the time if any pacifier in this Act for its filing or registration on payment of late fee specified in the said Sched)le II.

PA T ?*** C!'PAN*+S A2T:! *F+/ T! ;+ +8*ST+ +/

0&4. companies capable of bein4 (e4iste(ed.## !" With the exception and s)b.ect to the pro+isions mentioned and contained in this section% any company formed whether before or after the commencement of this Act in p)rs)ance of any Act of 1arliament other than this Act or being otherwise d)ly constit)ted according to law and consisting of se+en or more members% s many at time register )nder this Act as an )nlimited company or as a company<by shares or as a company limited by g)arantee; and the registration not be in+alid by reason that it has ta2en place with a +iew to the company being wo)nd )p P(o9ided that # a" a company ha+ing the liability of its members limited by Act of 1arliament and not being a .oint/stoc2 company as in.ection 933% defined% shall not register in p)rs)ance of this section;

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b" a company ha+ing the liability of its members limited by Act of 1arliament shall not register in p)rs)ance of this section as an )nlimited company not register on p)rs)ance of this section as a company limited by g)arantee; c" a company that is not a .oint/stoc2 company as in section 933 defined shall not register in p)rs)ance of this section as a company limited by shares; d"" a company shall not register in p)rs)ance of this section witho)t the assent of a ma.ority of s)ch of its members as are present in person or by proxy% on cases where proxies are allowed by the articles at a general meeting s)mmoned for the p)rpose; e" where a company not ha+ing the liability of its members limited by Act of 1arliament is abo)t to register as a limited company% the molarity re8)ired to assent as mentioned it cla)se d" shall consist of not less than three/fo)rths of the members present in person or by proxy at the meeting; f" where a company is abo)t to register as a company limited by g)arantee% the assent ,# its being so registered shall a accompanied by a resol)tion declaring that each member )nderta2e to contrib)te to the assets of he company in the e+ent of its being wo)nd )p while he is member% or within one year afterwards% for payment of the debts and liability of the company contracted of winding )p and for the ad.)stment of the right of the contrib)tors among themsel+es s)ch amo)nt as may be re8)ired not exceeding a specified amo)nt. (" In comp)ting any ma.ority )nder this section% when a poll is demanded regard shall be had to the member of +otes to which each member is entities according to the articles. 0&&. /efinition of >oint stoc< company.## !":or the p)rposed of this part% so far as it relates to registration or companies limited by shares% a .oint/stoc2 company means// a" a company ha+ing a permanent paid )p or nominal share capital of fixed amo)nt di+ided into shares% also fixed amo)nt% or held of and transferable as stoc2 or di+ided and held partly in one way and partly in the other; and b" formed on the principle or ha+ing only for its members as the holders of those shares or that stoc2 and for no other person. (" S)ch a company% when registered with limited liability )nder this Act% shall be deemed to a a company limited by shares. 0&6. eAui(ements fo( (e4ist(ation of >oint stoc< compaines.## 6efore the registration in p)rs)ance of this part of .oint stoc2 company% there shall be deli+ered to the Registrar the following doc)ments that is to say// a" a list showing the names address occ)pation of all person who on a day named in the list not being more than six clear days before the day of registration were members of the company with the addition of the shares or stoc2 held by them respecti+ely di tinsmithing in the he case where the shares are n)mbered% each share by its n)mber; b" a copy of deed of settlement contract of copartner or other instr)ment constit)ent or reg)lation the company; and c" if the company is intended to be registered as a limited company% a statement specifying the following partic)lars% that is to say//

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i"" the nominal share capital of the company and the n)mber of shares into which its di+ided or the amo)nt of stoc2 of which it consists; ii" the n)mber of shares ta2en and the amo)nt paid on each share; iii" the name of the company with the addition of the word 0Cimited770 as the last ,E5 thereof; and IE" in the case of a company intended to be registered as a company limited by g)arantee% the resol)tion declaring the amo)nt of the g)arantee. 0&". eAui(ements fo( (e4ist(ation of companied othe( than >oint#stoc< companies.## 6efore the registration in p)rs)ance of this 1art of any company not being a .oint/stoc2 company% there shall be deli+ered to the Registrar.// a" a list showing the names% addressed and occasions of the directors of the company; and b" a copy of deed of settlement% contract of copartner or other instr)ment constit)ent or reg)lating the company; and c" in the case of a company intended to be tegistered as a company limited by g)arantee% a copy of the resol)tion declaring the amo)nt of the g)arantee. 0&8. Authentication of statement of e3istin4 Companies.## #he list of members and directors and any other partic)lars relating to the company re8)ired to be deli+ered to the Registrar shall be d)ly +erified by the declaration of any two or more directors or other principal officers of the company. 0&9. e4ist(a( may (eAui(e e9idence as to natu(e of company.## #he registrar may re8)ire s)ch e+idence as he thin2s necessary for the p)rpose of satisfying himself whether any company proposing to be registered is or is not a .oint stoc2 company as defined in section 933. 06% !n (e4ist(ation of ban<in4 company $ith limited liability, notice to be 4i9en to custome(.# !" Where a ban2ing company% which was in existence on the commencement of this Act% proposes to register as a limited company% it shall at least thirty days before so registering gi+e notice of its intention so to register ,# e+ery person who has a ban2ing acco)nt with the company be deli+ery of the notice to him by posting at or his last 2now address. (" If the company omits to gi+e the notice re8)ired by this section% then as between the company and the person for the time being interested in the acco)nt in respect of which the notice o)ght to ha+e been gi+en and so far as respect the acco)nt down to the time at which notice is gi+en b)t not f)rther or otherwise the certificate of registration with limited liability shall ha+e not operation. 061. +3emption of ce(tain Combines f(om payment of 7ees.## 4o fees shall be charged in respect of the registration in p)rs)ance of this part of a company if it is not registered as a limited company% or if before its registration as a limited company the liability of the shareholders was limited by some Act of 1arliament. 06.. Addition of =,imited= to name .## When a company registration in p)rs)ance of this part with limited liability the word 0Cimited shall form and be registered as part of its name. 060. Ce(tificate of (e4ist(ation of e3istin4 companies.## ,n compliance with the re8)irements of this 1art with respect to registration and on payment of s)ch fees% if any as are payable )nder Sched)le II% the RegisraLLL hall certificate )nder his land that the company applying for

!''

registration LL inLLorporated as a company )nder this Act and in the he a e of a limited company that it is limited% and there)pon the company shall be incorporated and shall ha+e perpet)al s)ccession and a common seal. 064. ?estin4 of p(ope(ty on (e4ist(ation.## All property mo+able and immo+able % incl)ding all interest and rights into and o)t of property% mobile and immo+able and incl)ding obligations and actionable claims as may belong to or be +ested in a company at the date of its registration the company as incorporated )nder this Act for all the estate and interest of the company therein. 06&. Sa9in4 of e3istin4 liabilities.## registration of a company in p)rs)ance of this 1art shall not affect the rights or liabilities of the company in whate+er manner s)ch right on liability accr)ed or arose. 066. Continuation of suits.## All s)its and other legal proceedings which at the time of the registration of a company% in p)rs)ance of this part are pending by or against the company or an officer or member thereof may be contin)ed in the same manner as if the registration had not ta2en place ne+ertheless exec)tion shall not iss)e against the effects of any indi+id)al member of the company on any decree or order obtained in any s)ch s)it or proceeding b)t in the e+ent of the property and effects of the company being ins)fficient to satisfy the decree or order% and order may be obtained for winding )p the company. 06" +ffect of (e4ist(ation unde( this Act5## When a company is registered in p)rs)ance of this 1art/ a" all pro+ision contin)ed in any Act of 1arliament deed of settlement contract of copartner or other instr)ment constit)ting or reg)lating the company or% in the case of a company registered as a company limited by g)arantee% the resol)tion declaring the amo)nt of the g)arantee% shall be deemed to be conditions and reg)lations of the company in the same manner and with the same incidence; as it// i" so m)ch thereof as wo)ld if the comma had been formed )nder this Act% ha+e been re8)ired to be inserted in the memorand)m% were consigned in a registered memorand)m; and ii" the resid)e there of were contin)ed in a registered article; b" all the pro+isions of this Act shall apply to the company and the members% contrib)tors and creditors there of in the he same manner in all respects as of it had been formed )nder this Act s)b.ect as follows % that is to say// i" the reg)lation in Sched)le I shall not apply% )nless adopted by the special resol)tion: ii" the pro+isions of this Act relating to the n)mbering of shares shall not apply to any .oint stoc2 company whose shares are not n)mbered: iii" s)b.ect to the 1ro+isions of this section the company shall not ha+e power to alter any pro+ision contained in any Act of 1arliament relating to the company; IE" in the in+ent of the company being wo)nd )p e+ery person shall e a contrib)tory% in respect of the debts and liability of the company contract before regretting who is liable to pay or contig)ity to the payment of any s)ch debt or liability or to pay or contig)ity to the payment of any s)m or the ad.)stment of the rights of the n)mber among themsel+es in respect of any s)ch debt or liability; or to pay or themsel+es in to the pay payment of the coat and expenses of winding )pon the company so far as relates to s)ch debts or liability as aforesaid of the company% in the

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co)rse of the winding )p all s)m/d)e form hi in respect of any s)ch liability as aforesaid; and in the e+ent of the death or insol+ency of the contrib)tor; the pro+isions of this Act with respect of the legal representati+e and heirs of decreased contrib)tors% % and with reference to the assignees of insol+ent contradictories% shall apply; c" the pro+isions of this Act with respect to// i" the registration of an )nlimited company as limited; ii" the powers of an )nlimited company on registration as a limited company to increase the nominal amo)nt of its shares capital<ital and to pro+ide that a portion of this share capital and to pro+ided that a prosing of ,# shares capital shall not be capable of being called )p except in the e+ent of winding )p; iii" the power of a limited company to determine that a prosing of its share capital shall not be capable of being called )p except in the e+ent of winding )p; shall apply withnotsanding any pro+isions contained in any Act or 1arliament % deed of settlement% contract of copartner or other instr)ment constit)tion or reg)lating the company.% d" nothing in this section shall a)thoress the company to alter any s)ch pro+isions contin)ed in any Act or 1arliament% deed of settlement contract of copartner or other instr)ment constit)tion or reg)lating the company% as wo)ld.% if the company had originally been formed )nder this Act ha+e been re8)ired to be contin)ed in the memorand)m and are not a)topsied to be altered by this Act. e" nothing in this Act shall derogate from any lawf)l power of altering its contin)ation or reg)lating the company which may by +irt)e of any Act of 1arliament% deed of settlement contract of copartner or other instr)ment constit)ting or reg)lating the company% be bested in the company. 068. Po$e( to substitute memo(andum and a(ticles fo( deed of settlement.## !" S)b.ect ,# the pro+isions of this section% as company registered in p)rs)ance of this part many by special resol)tion% alter the form of its connotation by s)bstit)ting a memorand)m and article for a deed of settled; (" the pro+ision of this Act with respect ,# confirmation by the $o)rt and registration of an alteration )nder this section with the following modifications% namely;// a" there shall be s)bsisted for the printed copy of the lathered memorand)m re8)ired to be filed with Registrar a printed copy of the s)bsisted memorand)m and articles; and b" on the respiration of the laceration being certified by the Registrar% the s)bsisted memorand)m and article shall apply to the company in the same manner as if it were a company registered )nder this Act with that memorand)m and those articles% and the company7 deed of settlement shall cease to apply to the company. 9" An alteration )nder this section may be made either with or witho)t any alteration of the ob.ects of the company )nder this Act. '" I4 this section% the expression 0deed of settlement0 incl)des any contract of copartner or other instr)ment constit)ting or reg)lating the company not being an Act of 1arliament.

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069. Po$e( of Cou(t !T stay o( (est(ain p(oceedin4s.## #he pro+isions of this Act with respect ,# to and restraining s2ittish and legal proceedings against a company at any time after the presentation of a petition for winding )p and before the ma2ing of a winding )p order shall% in the case of a company registered in p)rs)ance of this 1art% were the application to say or restrain is by creditor% extend to s2ittish and legal proceedings against any contrib)tory of the company. 0"% suits stayed on $indin4 up o(de(## when an order has been made for winding )p a company registered in p)rs)ance of this 1art% no s)it or other legal proceeding shall be commenced or proceeded with against the company or any contrib)tor of the company in respect of any debt of the company % except by lea+e of the $o)rt and s)b.ect to s)ch terms ad the co)rt may impose.

PA T *G E*N/*N8 2P P7 2N +8*ST+ +/ C!';*N+S

0"1. 'eanin4 of =un(e4a(ded company= ## :or the p)rposes of this 1art% the expression0 )nregistered company shall not incl)de a company registered )nder this Act or )nder any company law in force at any time company consisting of more than se+en members and not registered )nder this Act or the said company with the following exceptions and additions% namely:// a" no )nregistered company shall be wo)nd )p )nder this Act +ol)ntarily or s)b.ect to s)per+ision of the $o)rt; b" the circ)mstance in which an )nregistered company may be wo)nd )p are as follows namely;// i" if the company is dissol+ed or has ceased to carry on b)siness or is carrying on b)siness only for the p)rpose of winding )p its affairs; ii" if the company is )nable to pay its debts; iii" if the $o)rt is of option that is .)st and e8)itable that the company sho)ld be wo)nd )p. c" an )nregarded company shall for the p)rposes of this section deemed to be )nable to pay its debts. i" if a creditor% by assignment or otherwise to who the company is indebted in a s)m exceeding fi+e h)ndred ta2a then d)e has ser+ed on the company% by lea+ing at its principal place of b)siness% or by deli+ering to the secretary% or some directly% ser+ing in s)ch manner as the $o)rt may appro+e or direct a demand )nder his hand REM@IRI4* the company tot he pay ser+ice of the demand neglected to pay the s)m or to sec)re or compo)nd for it to the satisfaction of the creator; or ii" if any s)it or other legal proceeding has been instit)ted against any member or any debt or demand d)e or claimed to be d)e from the comma or from him in his character of member% and notice in writing of the instit)tion of the s)it or other legal proceeding ha+ing been ser+ed on the company by lea+ing the same at its p<principle place of b)siness or by deli+ering it to the

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secretary% or some director% Imanager or principal office of the company or by otherwise ser+ing the same in s)ch manner as the $o)rt may appro+e or direct% the company has not within ten days after ser+ice of the notice paid% sec)red or compo)nded for the debt or demand% proc)red an order for the s)it or other legal proceeding to be stayed% or indemnified the said member or defendant to this reasonable satisfaction against the s)itor defendant to his reasonable against all costs% damages and expense to be in inc)rred by him by reason of the same; or iii" if exec)tion or other process iss)ed on a decree or order obtained in any $o)rt in fa+o)r of a creditor against the company% or any member thereof as s)ch% or any person a)thori-ed to be )sed as nominal defendant on behalf of the company % is ret)rned )nsatisfied; or IE" if it is otherwise pro+ed to the satisfaction of the $o)rt that the company is )nable to pay its debts. (" 4othing in this 1art shall affect the operation of any enactment which pro+ides for any partnership% association or company being wo)nd )p or being wo)nd )p as a company or as )nregistered company % )nder any enactment repealed by this Act% except that reference in any s)ch any enactment repealed enactment shall be read as reference to the corresponding pro+ision% if nay% of this Act. 9" Where a company incorporate o)tside 6angladesh which has been carrying on b)siness in 6angladesh% it may be wo)nd )p as an )nregisor otherwise ceased to exist as a company )nder or by +)lt)re of the laws of the co)ntry )nder which it was incorporated. 0"0. Cont(ibuto(s in $indin4 up of un(e4iste(ed Companies.## !" In the e+ent of an )nregistered comma being wo)nd )p% e+ery person shall be deemed to a contrib)tory who is liable to pay or contrib)te to the payment of any debt or liability of the company% or to pay or contrib)te to the payment of any s)m for the ad.)stment of the rights of the members among themsel+es% or to pay or contrib)te to the payment of the costs and expenses of eyeing )p the company% and e+ery contrib)tory shall be to contrib)te to the assets of the company all s)ms d)e from him imp respect of any s)ch liability as aforesaid. (" In the e+ent of any contrib)tory dying or being ad.)dged insol+ent contrib)tors. 0"4. Po$e( to stay o( (est(ain p(oceedin4s.## #he pro+isions of this Act with respect to staying and restraining s)its and legal proceedings against a company at any time after the presentation of a petition for winding )p and before the ma2ing of a winding )p order shall% in the case of an )nregistered company% where the application ,# stay or restrains is by a creditor% extend to s2ittish and legal proceedings against any contrib)tory of the company. 0"&. est(ictions on commencin4 etc. of suit afte( $indin4 up o(de(.## Where an order has been made for winding )p of a company )nder this 1art% no s)it or other legal proceedings shall bee proceeded with or commenced against except by lea+e of the $o)rt % and s)b.ect ,# s)ch terms as the $o)rt may impose. 0"6. Cou(ts di(ections as to p(ope(ty in ce(tain cases.## If an )nregistered company has no power to s)e and be s)ed in a common name% or if for any reason it appears expedient the $o)rt may by the winding in order% or by any s)bse8)ent order% direct that all or any part of the property% mo+able and immo+able% and incl)ding obligations and actionable claims as may belong to the company or ,# trestles on its befall is to +est in the official li8)idator by his official named and there)pon the property or the part thereof specified in the order shall best accordingly% and the official li8)idator may% after gi+ing s)ch indemnity % if any% as the $o)rt may direct% bring or defend in his official name any s)it or other legal proceeding relating tot that

!'A

property% or necessary to be bro)ght or defended for p)rposes of effect)ally winding )p the company and reco+ering its property. 0"". P(o9isions of this pa(t cumulati9e.## #he pro+isions of this 1art with respect to )nregistered companies shall be addition to% and not in restriction of% any pro+ision herein before in this Act contained with respect ,# winding )pcompnaies by the $o)rt and the $o)rt official li8)idator may exercise any powers or do any act in the case of )nregistered $ombines which might be exercised or done by t or him in the winding )p of $ombines formed and registered )nder this Act; b)t an )nregistered company shall not except in the e+ent of its being wo)nd )p% be deemed ,# be a company )nder this Act% and then only to the extent pro+ided by this 1art.

PA T G 7! +*8N C!';*N+S@ +8*ST AT*!N, +TC.

0"8. application of sections 0"6 to 08" to fo(ei4n companies.## Sections 9?& to 9A? shall apply to all foreign $ombines% that is to say% campiness falling )nder the following two classes% namely:// a" $ombines incorporated o)tside 6angladesh which% after commencement of this Act establish a place of b)siness within 6angladesh; and b" combines incorporate o)tside 6angladesh which ha+e before the commencement of this Act% established a place of b)siness within 6angladesh and contin)ed to ha+e an established place of b)siness with 6angladesh% at the commencement of this Act. 0"9. /ocuments, etc. to be deli9e(ed to e4ist(a( by fo(ei4n Combines ca((yin4 on business in ;an4ladesh## !" :oreign $ombines% which after the commencement of this Act% establish a place of b)siness with 6angladesh shall% within one month of the establishment of the place of b)siness%% deli+er to the Registrar for registration// a" a certified copy of the charter or stat)es or memorand)m and articles of the company or other instr)ment constit)tion or defining the constit)tion of the company; and if the instr)ment is not written in 6eg)ile or English Cang)age% a certified 1enally or English translation thereof; b" the f)ll address of the registered or principal office of the company; c" a list of the directors and secretary% if any% of the company; d" the name and address or the names and addresses of one or more persons resident in 6angladesh% a)thori-ed to accept on behalf of the company ser+ice of p<process and any notice or other doc)ment re8)ired to be ser+ed on the company; e" the f)ll address of the office of the company in 6allades which to be deemed its principal place of b)siness in 6angladesh. (" foreign $ombines other than those mentioned in s)b/section !"% shall if they ha+e not deli+ered to the Registrar before the commencement of this Act the 5oc)ments and partic)lars

!'&

specified in the s)b/section !" and section contin)e to be s)b.ect to the obligation to deli+er those doc)ments and partic)lars in accordance with this Act. 9" If any alteration is made or cocc)s in// a" the charter% st)dies % or memorand)m and articles of foraging company or other instr)ment constit)ting or defining the constit)tion of a foreign company% or b" the registered or principal office of a foreign company or d" the names and addresses of the persons a)thori-ed to accept ser+ice on behalf of a foreign company% or e" the principal place of b)siness of a foreign company in 6angladesh% the $ompany sh % within the prescribed time% file with the Registrar a ret)rn containing the prescribed partic)lars of the alteration. 08% Accounts of fo(ei4n company.## !" E+ery foreign company shall% in e+ery calendar year.// a" ma2e o)t a balance sheet and profit and loss acco)nt or in the case of a company not trading for profit% and income and expendit)re acco)nt it the company is handling company% gro)p acco)nts in s)ch form and consigning s)ch partic)lars and incl)ding s)ch doc)ments% and )nder the pro+ision of this Act it wo)ld% if it had been accompany within the meaning of this Act% ha+e been re8)ired to ma2e o)t and lay before the company in general meeting; and d" deli+er three copies of those doc)ments to the Registrar: 1ro+ided that the *o+ernment may by notification in the official *a-ette direct that in the he case of a foraging company or class of foreign $ombines the re8)irements of cla)se a"" shall not apply% or shall apply s)b.ect to s)ch exceptions and modification as many be specified in the notification. (" If any s)ch doc)ment as is mentioned in s)b/section !" is not written in 1enal or English lang)age% there shall be annexed to it a certified translating thereof. a" in +eery prospect)s in+iting s)bscription in 6angladesh for its shares or debent)res% state the co)ntry in which the company is incinerated; b" conspic)o)sly exhibit on the o)tside of e+ery office or place where it carries on b)siness in 6angladesh% the name of the company and the co)ntry in which it is incinerated% in the letters easily legible in 6eg)ile or English character% c" ca)se the name of the company and of the co)ntry in which the company is inc)r o)tdated% to be stated in legible 1enally or English characters in all bill heads and letter paper% and in all notices and other official p)blications of the company; and. d" if the liability of the members of the company is limited% ca)se a notice of that fact// i" to be stated in e+ery S)+a prospect)s as aforesaid and in all bill heads% letter paper% notices% ad+ertisements and other official p)blications of the company% in legible 1enholders% in legible 1enally or English characters.

!3B

08.. Se(9ice on fo(ei4n company.## Any process notice% or other doc)ment re8)ired ,# be ser+ed on a foreign company shall be deemed to be s)fficiently ser+ed% if addressed to any person mentioned in section 9?&&!" d" and left at% or sent by post to the address which has ben so deli+ered )nder that section to the Registration. 1ro+ided that## a" where any s)ch company ma2e defa)lt in deli+ering to the Registrar in p)rs)ance of that section the name and address of a person% or b" if at any time all the persons whose names and address ha+e been deli+ered to the Registrar are dead% or ceased or ha+e ceased so to reside at those addresses% or ref)sed to accept on behalf of the company any process% notice or other doc)ment% or% those cannot be ser+ed or sent for any other reason% s)ch doc)ment may be ser+ed on the company by lea+ing it at% or sending it by post to% any place of b)siness established by the company in 6angladesh. 080. Notice of ceasin4 place of business of a company.## If any foreign company ceases to ha+e a place of b)siness in 6angladesh% it shall forthwith gi+e notice of the fact to the Registrar% and as from the date on which notice is so gi+en% the obligation of the company to deli+er any doc)ment to the Registrar shall cease% pro+ided it has no other place of b)siness in 6angladesh. 084. Penalties.## If any foreign company fails to comply with any of the foregoing pro+isions of this 1art% the company shall be p)nishable with fine which may extend to one tho)sand ta2a% or% in the case of a contin)ing offence% with an additional fine of fi+e h)ndred ta2a for e+ery day after the first day d)ring which the defa)lt contin)es; and e+ery officer or agent of the company who is 2nowingly willf)lly% ma2es s)ch defa)lt% shall be p)nishable with the same fine. 08&. Company@s failu(e to cmoply $ith this Pa(t not to affect its liability unde( cont(acts.## Any fail)re by a foreign company to comply with any of the foregoing pro+isions of this 1art shall not affect the +alidity of any contract dealing or transaction entered into by the company or its liability to be s)ed in respect thereof; b)t the company shall not be entitled to bring any s)it% claim any set off% ma2e any co)nter claim or instit)te any legal proceeding in respect of any s)ch contract% dealing or transaction )ntil it has complied with the pro+isions of this 1art. 086. 7ees fo( (e4ist(ation of documents unde( this Pa(t.## #here shall be paid to the Registrar for registering any doc)ment re8)ired by the foregoing pro+isions of this 1art s)ch fees as specified in Sched)le II. 08". *nte(p(etation.## :or the p)rposes of the foregoing pro+isions of this 1art// a" the expression 0director0 incl)des any person occ)pying the position of director by whate+er name called. b" the expression 0prospect)s0 has the same meaning as when )sed in relation to a company incorporated )nder this Act; c" the expression 0place of b)siness0 incl)des a share transfer or share registration office; d" the expression 0secretary0 incl)des any person occ)pying the position of secretary% by whate+er name called and e" the expression 0certified0 means certified in the prescribed manner to be a tr)e copy or a correct translation.

!3!

088. est(iction on sale and offe( fo( sale of sha(es.## !" It shall not be lawf)l for any person// a" to iss)e% circ)late or distrib)te in 6angladesh any prospect)s offering to the p)blic for s)bscription to shares in or debent)res of a company incorporated or to be incorporated o)tside 6angladesh whether the company has or has not established% or when formed will or will not establish% a place of b)siness in 6angladesh% )nless// i" before the iss)e% circ)lation or distrib)tion of the prospect)s in 6angladesh a copy thereof% certified by the chairman and two other directors of the company as ha+ing been appro+ed by resol)tion of the managing body% has been deli+ered for registration to the Registrar; ii" the prospect)s state on the face of it that the copy has been so deli+ered; iii" the prospect)s is dated; and i+" the prospect)s other wise complies with this 1art; or b" to tiss)e to any person in 6angladesh a form of application for shares in or debent)res of s)ch a company of intended company as aforesaid )nless the form is iss)ed with a prospect)s which complies the re8)irements of this 1art : 1ro+ided that this cla)se shall not apply if it is shown that the form of application was iss)ed in connection with a bonafide in+itation to a person to enter into an )nderwriting agreement with respect to the shares of debent)res. (" #his section shall not apply to the iss)e to existing members or debent)res holders of a company of a prospect)s or form of application relating to shares in or debent)res of the company% whether an applicant for shares or debent)res will not ha+e the right to reno)nce in fa+o)r of other persons% b)t% s)b.ect as aforesaid% this section shall apply to a prospect)s or form of application whether iss)ed or with reference to the formation of a company or s)bse8)ently. 9" Where any doc)ment by which any shares in or debent)res of a company incorporated o)tside 6angladesh are offered for sale to the p)blic wo)ld% if the company concerned had been a company within the meaning of this Act% ha+e been deemed by +irt)e of section !'( to be a prospect)s iss)ed by the company% that doc)ment shall be deemed to be% for the p)rposes of this section% a prospect)s iss)ed by the company. '" An offer of share or debent)res for s)bscription or sale to any person whose ordinary b)siness or part of whose ordinary b)siness is to by or sell shares or debent)res% whether as principal or agent% shall not be deemed an offer to the p)blic for the p)rposes of this section. 3" A person who is 2nowingly responsible for the iss)e% circ)lation or distrib)tion of any prospect)s% or for the iss)e of a form of application for shares or debent)res% in contra+ention of the pro+isions of this section shall be liable to a fine not exceeding ten tho)sand ta2a. >" In this section and in section 9A&% the expression 0prospect)s0 0shares0 and 0debent)res0 ha+e the same meaning as and when )sed in relation to a company incorporated )nder this Act. 089. eAui(ements as to p(ospectus.## In order to comply with this 1art a prospect)s% in addition to complying with the pro+isions of s)b/cla)ses ii" and iii" of cla)se a" of s)b/section !" of section 9AA% m)st// a" $ontain partic)lars with respect to the following matters% namely//

!3(

i" the ob.ects of the company; ii" the instr)ment constit)ting or defining the onstit)tion of the company; iii" the enactments% or pro+isions ha+ing the force of an enactment% by or )nder which the incorporation of the company was effected; i+" an address in 6angladesh where the said instr)ment% enactments or pro+isions% or copies thereof% and if the same are in a foreign lang)age other than English a translation thereof in the 6engali or English certified in the prescribe manner can be inspected; +" the date on which and the co)ntry in which the company was incorporated. +i" whether the company has established a place of b)siness in 6angladesh: 1ro+ided that the pro+isions of s)b/cla)se i"% ii"% and iii" of this cla)se shall not apply in the case of a prospect)s iss)ed more than two years after the date at which the company is entitled to commence b)siness; b" s)b.ect to the pro+isions of this section% state the matters specified in s)b/section !" of section !93 and set o)t the reports specified in that section : 1ro+ided that// i" where any prospect)s is p)blished as a newspaper ad+ertisement% it shall be a s)fficient compliance with the re8)irements that the prospect)s m)st specify the ob.ects of the company if the ad+ertisement specified the primary ob.ects with which the company was formed; and ii" in section !93 of this Act% a reference to the article of the company shall be deemed% to be a reference to the constit)tion of the company. (" Any condition re8)iring or binding any applicant for shares or debent)re shall be +oid% if the acceptance thereof has the effect of// a" wai+ing compliance with any re8)irements of this section; or b" ser+ing him with notice of any contract% doc)ment or matter not specifically referred to in the prospect)s. 9" In the e+ent of non/compliance with or contra+ention of any of the re8)irements% of this section% a director or other person responsible for the prospect)s shall not inc)r any liability by reason of the non/compliance or contra+ention% if// a" as regards any matter not disclosed% he pro+es that he was not congni-ant thereof; or b" he pro+es that the non/compliance or contra+ention arose from an honest mista2e of fact on his part; or c" the non/compliance or contra+ention was in respect of matter which% in the option of the co)rt dealing with the case% were immarterial or were otherwise s)ch as o)ght% in the option of that $o)rt% ha+ing regard to all the circ)mstances of the case% reasonably to be exc)sed.

!39

1ro+ided that in the e+ent of fail)re to incl)de in a prospect)s a statement with respect to the matters specified in cla)se !A of the 1art/I of Sched)le/III or in p)rs)ance of s)b/section !" of section !93% no director or other person shall ins)re any liability in respect of the fail)re )nless it be pro+ed that he had 2nowledge of the matters not disclosed. '" 4othing in this section limit or diminish any liability which any person may inc)r )nder the general law or this Act% apart from this section. 09%. est(iction on can9assin4 fo( sale of sha(es.## !" It shall be an oftence of any person goes from ho)se to ho)se of the p)blic or any member of p)blic offering shares of a company incorporoated o)tside 6angladesh for s)bscription to or sale of s)ch shares. (" In this s)b/section the expression Iho)se0 shall not incl)de an office )sed for b)siness p)rposes. 9" Any person acting in contra+entions of this section shall be liable to a fine not exceeding fi+e h)ndred ta2a. 091. P(o9isions (e4a(din4 cha(4es.## #he pro+isions of section !3& to !>A/ both incl)si+e% and !?! to !?>% both incl)si+e% shall extend to charge on properties in 6angladesh which are created and to charges on property in 6angladesh which )s ac8)ired% by a company incorporated o)tside 6angladesh which has an established place of b)siness in 6angladesh : 1ro+ided that% were a charge is created o)tside 6angladesh or the completion of the e8)isition of property ta2es place o)tside 6angladesh% s)b/cla)se i" of the pro+iso to s)b/section !" of section !3& and the pro+iso to s)b/section !" of section !>B shall apply as if the property where+er sit)ated were sit)ated tside 6angladesh. 09.. Notice of appointment of (ecei9e( etc.## !" #he pro+isions of section !>& and !?B share apply to the case of all companies incorporated o)tside 6angladesh b)t ha+ing an established place of b)siness in 6angladesh. (" #he pro+isions of section !A! shall apply to s)ch companies to the extent of re8)iring them to 2eep at their principal place of b)siness in 6angladesh the boo2s of acco)nt re8)ired by that section with respect to money recei+ed and expended% sales and p)rchases made% and assets and liabilities in relation to its b)siness in 6angladesh.

PA T G* S2PP,+'+NTA,
,e4al p(oceedin4s, offence, etc.

090. Co4niDance of offence.## !" 4o $o)rt inferior to that of a Hagistrate of the first class shall try any offence )nder this Act. (" 4otwithstanding anything contained in the $ode of $riminal 1roced)re% !A&A E of !A&A"%// a" e+ery offence )nder this Act shall% for the p)rpose of the said $ode% be deemed to be non/ cogni-able.

!3'

b" where the complainant is the Registrar% the personal attendance of the complainant before the $o)rt trying the offence shall not be necessary )nless the $o)rt% for reasons to be recorded in writing% re8)ires his personal attendance for the p)rpose of ta2ing cogni-ance or holding trial. 094. Application of fines.## #he co)rt imposing any fine )nder this Act may direct that the whole or any part thereof be applied in or towards payment of the cost of the proceedings% or in or towards the rewarding of the person on whose information the fine is reco+ered. 09&. Po$e( to (eAui(e limited company to 4i9e secu(ity fo( costs.## Where a limited company is plaintiff or petitioner in any s)it or other legal proceeding% any $o)rt ha+ing .)risdiction in the matter may% if it appears that there is reason to belie+e that the company will be )nable to pay the cost of the defendant if s)ccessf)l in his defence% re8)ire s)fficient sec)rity to be gi+en for those costs% and may stay all proceedings )ntil the sec)rity is gi+en. 096. Po$e( of Cou(t to 4(ant (elief in ce(tain cases.## !" If in any proceeding for negligence% defa)lt% breach of d)ty or breach of tr)st against a person specified in s)b/section 9% it appears to the $o)rt hearing the case that persons is or may be liable in respect of the negligence% defa)lt% breach of d)ty or breach of tr)st% b)t that he has acted honestly and reasonably% and that ha+ing regard to all the circ)mstances of the case% incl)ding those connected with his appointment% he o)ght fairly to be exc)sed for the negligence% defa)lt% breach of d)ty or breach of tr)st% that $o)rt may relie+e him% either wholly or partly% from his lability on s)ch terms as the $o)rt may thin2 fit. (" Where any person specified in s)b/section 9" has reason to apprehend that any claim will o might be made against him in respect of any negligence% defa)lt% breach of d)ty or breach of tr)st% he may apply to the $o)rt for relief% and the $o)rt on any s)ch application shall ha+e the same power to relie+e him )nder this s)b/section of it wo)ld ha+e )nder s)b/section !". 9" #he persons to whom this section applies are the following:/ a" directors of a company; b" managers and managing agents of a company; c" officers of a company; d" persons employed by a company as a)ditors% whether they are or are not officers of the company. 09". Penalty fo( false statement.## Whoe+er in any ret)rn% report% certificate balance/sheet or other doc)ments% re8)ired by or for the p)rposes of any of the pro+isions of this Act% willf)lly ma2es a statement false in any material partic)lar% 2nowing it to be false% shall be p)nishable with imprisonment of either description for a term which may extend to fi+e years% and shall also be liable tofine. 098. Penalty fo( $(on4ful $ith holdin4 of p(ope(ty.## Any director% managing agenst% manager or other officer or employee of a company who wrongf)lly obtains possession of any property of a company% or ha+ing any s)ch property in his possession wrongf)lly withholds it or wilf)lly applies it to p)rposes other than those expressed or directed in the articles and a)thorised by this Act% shall on the complaint of the company or a creditor or contrib)tory there/of% be p)nishable with fine not exceeding fi+e tho)sand ta2a% and may be orderd by the $o)rt trying the offence to deli+er of or ref)nd within a time to be fixed by the $o)rt any s)ch property improperly obtained

!33

or wrongf)lly with/ held or wilf lly misapplied% or in defa)lt to s)ffer imprisonment for a period not exceeding two years. 099. Penalty fo( misapplication of secu(ities by employe(s.## !" All moneys of sec)rities deposited with a company by its employees in p)rs)ance of their contracts of ser+ice% with the company shall be 2ept or deposited by the company in a special acco)nt to be opened by the company for this p)rpose in a sched)led ban2 as defined in the 6angladesh 6an2 ,rder% !&?( 1.,.4o. !(? of !&?(" and no portion thereof shall be )tilised by the company except for the p)rposes agreed to in the contract of ser+ice. (" Where a pro+ident f)nd has been constit)ted by a company for its employees or any class of its employees% all moneys contrib)ted to s)ch f)nd whether by the company or% by the employees or acr)ing by way interest or otherwise to s)ch f)nd shall be either deposited n a 1ost ,ffice Sa+ing 6an2 acco)nt or in+ested in sec)rities mentioned or referred to in cla)ses a" to e" of section (B of the #r)sts Act% !AA( II of !AA(" : and all moneys belonging to s)ch f)nd which are so deposited or in+ested shall be so deposited or in+ested in s)ch sec)rities by ann)al instalments not exceeding ten in n)mber and not less in amo)nt in any year than one tenth of the whole amo)nt of s)ch moneys. 1ro+ided that where the said one/tenth part of the whole amo)nt of the moneys belonging to s)ch f)nd exceeds the maxim)m amo)nt which may be deposited in a 1ost ,ffice Sa+ings 6an2 acco)nt )nder the r)les reg)lating s)ch deposits for the time being in force% the excess amo)nt may be 2ept or deposited in a special acco)nt to be opened for the p)rpose in s)ch sched)led ban2. 9" 4otwithstanding anything to the contrary in the r)les of any f)nd to which s)b/section (" applies or in any contract between a company and its employees% no employee shall be entitled to recei+e in respect of s)ch portion of the amo)nt to his credit in s)ch f)nd as is in+ested in accordance with the pro+isions of s)b/section (" interest at a rate exceeding the rate of interest yielded by s)ch in+estment. '" An employee shall be entitled on re8)est made in this behalf to the company to see the ban2 receipt for any money on sec)rity s)ch as is referred to in s)b/sections !" and (". 3" Any director% managing agent% managing or other officer of the company who 2nowingly contra+ention or permits or a)thorises the contra+ention of the pro+isions of this section shall be liable on con+iction to a fine not exceeding fi+e h)ndred ta2a. >" 4othing in s)b/section (" shall affect any right of any employee )nder the r)les of a pro+ident f)nd to obtain ad+ance from or to withdraw money standing to his credit in the f)nd where the f)nd is a recognised pro+ident f)nd within the meaning of cla)se 3(" of section ( of the Income #ax ,rdinance% !&A' DDDEI of !&A'"% or the r)les of the f)nd containing pro+isions corresponding to r)les '%3%>%?%A and & and & of the Income #ax 1ro+ident f)nd R)le% !&A'" or similar pro+isions of a similar R)les. 4%%. Penalty fo( imp(ope( use of the $o(d =,imited= If any person of persons trade or carry on b)siness )nder any name of title of which 0Cimited0 is the last word% that person or those persons shall be liable to a fine not exceeding fi+e h)ndred ta2a e+eryday )pon which that name or title has been )sed. 4%1. Const(uction of = e4ist(a( of 1oint Stoc< Companies= in Act GG* of 186%.## In sections I and !A of the Societies Registration Act% !A>B DDI of !A>B"% for the registration of Citeracy% Scientific and $haritable Societies% the words 0Registrar of Koint Stoc2 $ompanies0 shall be constr)ed to mean the Registrar )nder this Act.

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4%.. epeal and sa9in4s.## !" #he $ompanies Act !&!9 EII of !&!9%" hereinafter referred to as the said Act% is hereby repealed. (" 4otwithstanding the repeal of the said Act// a" any order% r)le% reg)lation% appointment% mortgage on other transfer deed% doc)ment or agreement made% fee directed% resol)tion passed% direction gi+en% proceeding ta2en% instr)ment exec)ted or iss)ed% or thing done )nder or in p)rs)ance of the said Act shall% if in force at the commencement of this Act% comtin)e to be in force and shall ha+e effect as if made% directed% passed% gi+en% ta2en% exce)ted% iss)ed or done )nder or in p)rs)ance of this Act; b" any person appointed to any office )nder or by +irt)e of the said Act shall be deemed to ha+e been appointed to that office )nder or by +irt)e of this Act; c" the offices existing at the commencement of this Act for the registration of companies shall be contin)ed as if they had been established )nder this Act; d" any register or other 2ept or made )nder the pro+isions of the said Act shall be deemed to be part of the register of other doc)ment to be 2ept or made )nder the corresponding pro+isions of this Act; e" all f)nds constit)ted and acco)nts 2ept )nder this said Act shall be deemed to be in contin)ation of the f)nds constit)ted and acco)nts 2ept )nder the corresponding pro+isions of this Act. 9" 4othing in this Act shall affect the incorporation of any company registered )nder the said Act or the operation of the pro+isions of the Ins)rance Act !&9A IE of !&9A". 4%0. Section 6 of the 8ene(al Clauses Act, 189" to apply.## #he mention of partic)lar matters in section 'B( or in any other pro+ision of this Act shall not pre.)dice the general application of section > of the *eneral $la)ses Act% !A&? D of !A&?". 4%4. Publication of Authentic +n4lish Te3t.## After the commencement of this Act% the *o+ernment shall% by notification in the official ga-ette p)blish a #ext of this Act translated in English% and this #ext shall be called the A)thentic English #ext of the Act : 1ro+ided that in the e+ent of conflict between the Act 6angali #ext" and the said English #ext. the Act shall pre+ail.

The +nd

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