(W.P. Ordinance XXII of
1959)
[22 April 1959]
An
Ordinance to prohibit the registration of companies for carrying on business
for certain undesirable purposes and to provide for the winding up and
dissolution of such companies
Preamble.— WHEREAS it is expedient to prohibit the
registration of companies for carrying on business for certain undesirable
purposes and to provide for the winding up and dissolution of such companies;
Now,
THEREFORE, in pursuance of the Presidential Proclamation of the seventh day of
October, 1958, and in exercise of all powers enabling him in that behalf, the
Governor of West Pakistan is pleased to make and promulgate the following
Ordinance:-
1. Short title and extent.— (1) This Ordinance may be called [3][3][the Punjab] Undesirable Companies Ordinance,
1959.
2. Definitions.— (1) In this Ordinance, unless the context
otherwise requires, the following expressions shall have the meaning hereby
respectively assigned to them, that is to say—
(a) “registrar” means—
(i) in the case of a company,
the registrar appointed under section 248 of the Companies Act, 1913[6][6], and
(ii) in any other case, an officer appointed as such
for purposes of this Ordinance;
(b) “specified purposes” means
the promotion or the carrying on of any scheme or business except the business
authorised and carried on under the provisions of the Insurance Act, 1938[7][7], by whatever name called, whereby, in return for a
deposit or contribution, whether periodically or otherwise, of a sum of money
in cash or by means of coupons, certificates, tickets or other documents,
payment, at future date or dates or money or grant of property, right or
benefit, directly or indirectly, and whether with or without any other right or
benefit, determined by chance or lottery or any other like manner, is assured
or promised;
(c) “undesirable company” means
a company which, with objects and business confined to the Province of [8][8][the Punjab], is registered under the Companies Act, 1913[9][9], and carries on business for a specified purpose or for
purposes which, among others, include a specified purpose and includes a
company, association or other body of individuals which carries on business for
a specified purpose or for purposes which, among others, include a specified
purpose.
(2) Any expression used but not defined in
this Ordinance and defined in the Companies Act, 1913[10][10], shall have the meanings assigned to it in
that Act.
3. Registration of undesirable companies
prohibited.— (1)
Notwithstanding anything in the Companies Act, 1913[11][11], or in any other law for the time being in
force, no association or other body of individuals which, with objects and
business confined to the Province of [12][12][the Punjab], carries or intends to carry on
business for a specified purpose or for purposes which, among others, include a
specified purpose, shall on and after the commencement of this Ordinance, be
registered under the Companies Act, 1913[13][13].
(2) Registration in contravention of
sub-section (1) shall be void.
(3) Notwithstanding anything contained in any
other law for the time being in force, no company, association or other body of
individuals, with objects and business confined to the Province of [14][14][the Punjab], shall carry on, or shall be
formed to carry on, business for a specified purpose or for purposes which,
among others, include a specified purpose.
(4) Any person who forms or associates
himself in the formation of a company, association or other body of individuals
in contravention of sub-section (3) and every officer or agent of a company,
association or other body of individuals which carries on business in contravention
of the said sub-section shall be punished with imprisonment for a term which
may extend to three years or with fine or with both.
4. Existing undesirable companies to cease
functioning.— (1) Every
undesirable company existing immediately before the commencement of this
Ordinance shall, on such commencement, cease to function and, notwithstanding
anything in the Companies Act, 1913[15][15] or in any other law for the time being in
force, shall be wound up and dissolved in the manner provided in this Ordinance.
(2) Any transaction with an undesirable
company or with any officer or agent acting for or on behalf of such company
shall be void.
(3) Any officer or agent acting for or on
behalf of any such company who, on or after commencement of this ordinance,
carries on or attempts to carry on the business of the company shall be
punished with imprisonment for a term which may extend to three years or with
fine or with both.
5. Deposit of cash and preservation of
assets, etc.— (1) Any
officer or agent acting for or on behalf of an undesirable company who has in
his possession or under his control any cash belonging to the company shall,
immediately after the commencement of this ordinance, deposit or cause to be
deposited such cash with the company’s bankers.
(2) Until such time as the official
liquidator appointed under section 7 takes into his custody or under his
control all the books, documents and assets of the company, including
actionable claims to which the company is or appears to be entitled, every officer
and agent acting for or on behalf of the company shall preserve all such books,
documents, assets, property, effect and claims and shall be jointly and
severally liable for any loss or damage.
(3) Any person who, with intent to evade the
provisions of this Ordinance, conceals, destroys, mutilates or defaces any
books, documents, assets, property, effects or claims or knowingly allows such
concealment, destruction, mutilation or defacement to be caused, shall, without
prejudice to any liability to which he may be subject under sub-section (2), be
punished with imprisonment for a term which may extend to three years or with
fine or with both.
6. Statement of assets, etc. to be
submitted to registrar.— (1)
Within three days of the commencement of this Ordinance, or within such period
as the registrar may allow, the manager of an undesirable company shall submit
to the registrar a statement showing the assets and liabilities of the company.
(2) Any one who contravenes the provisions of
sub-section (1) shall be punished with imprisonment for a term which may extend
to one year or with fine or with both.
7. Winding up undesirable companies.— (1) As soon as may be after receipt of the
statement submitted under sub-section (1) of section 6, the registrar shall
make a petition to the court for winding up the company, and thereupon the
court shall make an order for the winding up of the company and shall appoint
an official liquidator for such winding up.
(2) After the official liquidator has been
appointed under this section, the provisions of the Companies Act, 1913[16][16], relating to the winding up by court of a
registered company shall mutatis mutandis
apply in relation to the winding up of the company in respect of which the
petition has been made under sub-section (1).
8. Dissolution of undesirable companies.— When the affairs of an undesirable company
have been completely wound up, the company shall be deemed to have been
dissolved under sub-section (1) of section 194 of the Companies Act, 1913[17][17].
9. Power to call for certain information,
etc.— (1) Where the
registrar has reason to believe that a company is an undesirable company or
that an undesirable company is carrying on business in contravention of section
4, he or any gazetted officer authorised by him in this behalf, may—
(a) direct any person to give such information in
his possession with respect to any business carried on by that company as he
may demand;
(b) inspect or cause to be inspected any book or
other document belonging to or under the control of the company or any officer
thereof;
(c) enter and search any premises and seize or
authorise any person to seize any book or other document belonging to or under
the control of the company or any officer thereof.
(2) If the registrar is satisfied that a
company is an undesirable company or that an undesirable company is carrying on
business in contravention of section 4, he shall by order in writing, direct
the manager of the company to hand over the management of the company to a
person to be appointed by the registrar for the purpose, and the manager shall
forthwith hand over the management of the company to such person.
(3) The person to whom management is handed
over in pursuance of sub-section (2) shall be deemed to be the manager of the company,
and the other provisions of this Ordinance shall apply accordingly.
(4) Whoever fails to comply with any
direction given under sub-section (1) or sub-section (2) shall be punished with
imprisonment for a term which may extend to six months or with fine or with
both.
10. Offences to be cognizable.— Notwithstanding anything contained in the
Code of Criminal Procedure, 1898[18][18], any offence under this Ordinance shall be
cognizable.
11. Cognizance by court with the consent of
registrar.— No court shall
take cognizance of any offence under this Ordinance except with the previous
consent in writing of the registrar.
12. Power to make rules.— The Provincial Government may make rules to
carry out the purposes of this ordinance, and such rules may provide that the
breach of any of them shall be punishable with imprisonment for a term not
exceeding three months or with fine not exceeding one thousand rupees.
[1][1]This Ordinance was
promulgated by the Governor of West Pakistan on 20th April, 1959; published in
the West Pakistan Gazette (Extraordinary), dated 22nd April, 1959, pages
339-43; saved and given permanent effect by Article 225 of the Constitution of
the Islamic Republic of Pakistan (1962).
[2][2]Substituted by the Punjab
Laws (Adaptation) Order, 1974 (Pb. A.O. 1 of 1974), for “West Pakistan”.
[5][5]Substituted by the Punjab
Laws (Adaptation) Order, 1974 (Pb. A.O. 1 of 1974), for “West Pakistan”.
[8][8]Substituted by the Punjab
Laws (Adaptation) Order, 1974 (Pb. A.O. 1 of 1974), for “West Pakistan”.
[12][12]Substituted by the Punjab
Laws (Adaptation) Order, 1974 (Pb. A.O. 1 of 1974), for “West Pakistan”.
[14][14]Substituted by the Punjab
Laws (Adaptation) Order, 1974 (Pb. A.O. 1 of 1974), for “West Pakistan”.
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