PAPER - D9

COMPANY LAW
Study Plan

From the desk of

Qaseem Usman Rais
qaseem4u@gmail.com
qaseem4u@ymail.com
qaseem4u@msn.com
qaseem4u@hotmail.com
ICAP Recommended Reading

PAPER D 9: COMPANY LAW

Book Name & Author About the Book

1. Complete Company Law S. A. Salam Bare Law and brief explanation thereon are
(Relevant topics) included in the book.

2. Practical Approach to the Companies The book is useful for understanding practical
Ordinance, 1984 by Nazir Ahmed Shaheen application of law. (Relevant topics)

SUPPLEMENTARY STUDY MATERIAL

1. Company Law Study Text and Revision Series by A T Foulks Lynch Pakistan
2. Company Law Study Text and Revision Series by Professional Business Publications (PBP)
3. Company Law for MFC Module-D by PAC
 MODULE D
PAPER D 9: COMPANY LAW (100 marks)

OBJECTIVE:

This course is to provide candidates with knowledge of the Companies Ordinance, 1984 and to develop amongst them an understanding of their
application to corporate and other business environment, excluding advanced topics such as provisions relating to arbitration, arrangements and
reconstruction, prevention of oppression and mismanagement, winding up etc. that are covered at the Final Examination stage.

INDICATIVE GRID

SYLLABUS CONTENTS WEIGHTAGE

1. The Companies Ordinance, 1984 – Sections 1-51
Part I Preliminary (concepts of terms defined)
Part II Jurisdiction of courts 20
Part III Section 12 and Section 13
Part IV Incorporation of companies and matters incidental thereto
First schedule to the Companies Ordinance, 1984
The Securities and Exchange Commission of Pakistan Act, 1997

2. The Companies Ordinance, 1984 – Sections 52-136

Part V Prospectus, allotment, issue and transfer of shares and debentures, deposits, etc.
Part VI Share capital and debentures. 25
Part VII Registration of mortgages, charges etc.

3. The Companies Ordinance, 1984 – Sections 142-262

55
Part VIII Management and Administration (excluding investigation & related matters)
Third Schedule to the Companies Ordinance, 1984

TOTAL 100
Note: The weightages given above are for guidance purposes only and some deviations in setting of papers could be expected
 COMPANY LAW MODULE - D Study Plan

REFERENCE (BOOK PAGE NUMBER) REGISTER

REVISION REVISION
SECTION NO. DESCRIPTION Companies PAGE DONE
PAC ATFL KP NO.1 NO.2
Ordinance, 1984 NUMBER

OTHER
Section-3 Meaning of "subsidiary" and "holding company"

Section-4 Ordinance not to apply to certain corporations

Section-5 Application of Ordinance to non-trading companies with purely provincial objects

Section-6 Ordinance to override memorandum, articles, etc.

Section-14 Obligation to register certain associations, partnerships, etc. as companies.

Section-503 Application of Ordinance to companies governed by special enactments

MEMORANDUM OF ASSOCIATION
Section-29 Forms of memorandum and articles

Section-15 Mode of forming a company

Section-16 Memorandum of company limited by shares

Section-17 Memorandum of company limited by guarantee

Section-18 Memorandum of unlimited company

Name Clause

Section-37 Prohibition of certain names

Section-38 Rectification of name of a company

Section-39 Change of name by a company

Section-40 Registration of change of name and effect thereof

Section-143 Publication of name by a limited company

Section-144 Penalties of non-publication of name

Section-41 Alteration of names on commencement of Ordinance and change of status of company

Registered Office

Section-142 Registered office of company

Section-21(1) Alteration of memorandum

Section-21(2) Alteration of memorandum

Object Clause

Section-21(1) Alteration of memorandum

Liability Clause
Liability for carrying on business with less than three or, in the case of a private company,
Section-47
two members
Section-34 Effect of alteration in memorandum or articles

Section-28 Alteration of articles

Section-108 Variation of shareholders' rights

Capital Clause

Section-89 Nature of shares and certificate of shares

1
 COMPANY LAW MODULE - D Study Plan

REFERENCE (BOOK PAGE NUMBER) REGISTER

REVISION REVISION
SECTION NO. DESCRIPTION Companies PAGE DONE
PAC ATFL KP NO.1 NO.2
Ordinance, 1984 NUMBER

Section-90 Classes and kinds of shares capital

Section-145 Publication of authorised as well as paid-up-capital

Section-91 Only fully paid shares to be issued

Section-92 Power of company limited by shares to alter its share capital

Increase and reduction of share capital in case of company limited by guarantee having
Section-107
share capital
Section-87 Issue of shares in lieu of outstanding balance of any loans, etc.

Section-94 Notice of increase of share capital or of members

Section-93 Notice to register of consolidation of share capital, etc.

Other Matters

Section-19 Printing, signature, etc., of memorandum

Section-20 Restriction on alteration of memorandum

Section-21(3) Alteration of memorandum

Section-23 Exercise of discretion by Commission

Section-24(1) Procedure on confirmation of the alteration

Section-24(3) Procedure on confirmation of the alteration

Section-25 Effect of failure to register within ninety days

ARTICLES OF ASSOCIATION
Section-26 Registration of articles

Section-27 Printing, signature, etc. of articles

Section-28 Alteration of articles

Section-29 Forms of memorandum and articles

REGISTRATION OF MEMORANDUM AND ARTICLES OF ASSOCIATION

Section-30 Registration of memorandum and articles, etc.

Section-31 Effect of memorandum and articles

Section-32 Effect of registration

Section-33 Conclusiveness of certificate of incorporation

Section-22 Powers of Commission when confirming alteration

Section-35 Copies of memorandum and articles to be given to members

Section-36 Alteration of memorandum or articles to be noted in every copy

PROSPECTUS
Section-53 Matters to be stated and reports to be set out in prospectus

Section-52 Prospectus to be dated

Section-54 Expert to be unconnected with formation or management of company

Section-55 Expert's consent to issue of prospectus containing statement by him

Section-56 Penalty and interpretation

2
 COMPANY LAW MODULE - D Study Plan

REFERENCE (BOOK PAGE NUMBER) REGISTER

REVISION REVISION
SECTION NO. DESCRIPTION Companies PAGE DONE
PAC ATFL KP NO.1 NO.2
Ordinance, 1984 NUMBER

Section-57 Approval, issue and registration of prospectus

Terms of contract mentioned in prospectus or statement in lieu of prospectus not to be
Section-58
varied
Section-59 Civil liability for misstatements in prospectus

Section-63 Interpretation of provisions relating to prospectus

Section-60 Criminal liability for misstatements in prospectus

Section-61 Document containing offer of shares or debentures for sale to be deemed prospectus

Section-62 Offer of shares or debentures for sale by certain persons

Section-62 A Issue of securities outside Pakistan

Section-64 Newspaper advertisement of prospectus

Section-65 Construction of references to offering shares or debentures to the public etc.

Section-66 Penalty for fraudulently inducing persons to invest money

COMMISSION
Power to pay certain commissions, and prohibition of payment of other commissions,
Section-82
discounts, etc.
ALLOTMENT
Section-67 Application for, and allotment of, shares and debentures

Section-68 Restriction as to allotment

Section-70 Effect of irregular allotment

Section-71 Repayment of money received for shares not allotted

Section-72 Allotment of shares and debentures to be dealt in on stock exchange

Section-73 Return as to allotments

STATEMENT IN LIEU OF PROSPECTUS

Section-69 Statement in lieu of prospectus

COMMENCEMENT OF BUSINESS
Section-146 Restrictions on commencement of business

CERTIFICATE OF SHARES AND DEBENTURES

Section-74 Limitation of time for issue of certificates

Section-75 Issue of duplicate certificates

TRANSFER OF SHARES AND DEBENTURES

Section-76 Transfer of shares and debentures

Section-77 Directors not to refuse transfer of shares

Section-78 Notice of refusal to transfer

Section-78A Appeal against refusal for registration of transfer

3
 COMPANY LAW MODULE - D Study Plan

REFERENCE (BOOK PAGE NUMBER) REGISTER

REVISION REVISION
SECTION NO. DESCRIPTION Companies PAGE DONE
PAC ATFL KP NO.1 NO.2
Ordinance, 1984 NUMBER

Section-79 Transfer to successor-in-interest

Section-80 Transfer to nominee of a deceased member

Section-81 Transfer by nominee or legal representative

FURTHER ISSUE OF CAPITAL

Section-86 Further issue of capital

PURCHASE OF OWN SHARES

Prohibition of purchase or grant of financial assistance by a company for purchase of its
Section-95
own or its holding company’s shares
Section-95A Power of company to purchase its own shares

REDUCTION OF CAPITAL

Section-96 Reduction of share capital

Section-97 Application to Court for confirming order

Section-98 Addition to name of company of 'and reduce'

Section-99 Objection by creditors and settlement of list of objecting creditors

Section-100 Power to dispense with consent of creditor on security being given for his debt

Section-101 Order confirming reduction

Section-102 Registration of order and minute of reduction

Section-103 Minute to form part of memorandum

Section-104 Liability of members in respect of reduced shares

Section-105 Penalty on concealment of name of creditor

Section-106 Publication of reasons for reduction

Increase and reduction of share capital in case of company limited by guarantee having
Section-107
share capital
PREMIUM ON SHARE
Section-83 Application of premium received on issue of shares

DISCOUNT
Section-84 Power to issue shares at a discount

REDEMPTION
Section-85 Redemption of preference shares

ASSOCIATIONS NOT FOR PROFIT

Section-42 Power to dispense will "Limited" in the name of charitable and other Companies

COMPANIES LIMITED BY GUARANTEE

Section-43 Provision as to companies limited by guarantee

REGISTRATION OF UNLIMITED COMPANY AS LIMITED

Section-109 Registration of unlimited company as limited

Section-110 Power of unlimited company to provide for reserve share capital on re-registration

4
 COMPANY LAW MODULE - D Study Plan

REFERENCE (BOOK PAGE NUMBER) REGISTER

REVISION REVISION
SECTION NO. DESCRIPTION Companies PAGE DONE
PAC ATFL KP NO.1 NO.2
Ordinance, 1984 NUMBER
CONVERSION OF PUBLIC COMPANY INTO PRIVATE COMPANY AND
VICE VERSA
Section-44 Conversion of public company into private company
Prospectus or statement in lieu of prospectus to be filed by private company on ceasing
Section-45
to be private company
Consequence of default in complying with conditions constituting a company a private
Section-46
company

DEPOSITS
Section-88 Deposits not to be invited without issuing an advertisement

Section-226 Securities and deposits, etc.

DEBENTURES
Section - 114 Debentures not to carry voting rights

Section - 115 Perpetual debentures

Section - 116 Power to re-issue redeemed debentures in certain cases

Payment of certain debts out of assets subject to floating charge in priority to claims
Section - 118
under the charge
Section - 119 Powers and liabilities of trustee

Section - 117 Specific performance of contract to subscribe for debentures

Section - 113 Right of debenture-holder and shareholder to have copies of trust-deed

Section - 247 Rights of debenture-holders, etc., as to receipt and inspection of report, etc.

Section - 120 Issue of securities and redeemable capital not based on interest

REGISTRATION OF MORTGAGES, CHARGES, ETC.

Section - 121 Certain mortgages and charges to be void if not registered

Section - 122 Registration of charges on properties acquired subject to charge

Section - 123 Particulars in case of series of debentures entitling holders pari passu

Section - 124 Particulars in case of commission, etc. on debentures

Section - 125 Register of mortgages and charges

Section - 126 Index to register of mortgages and charges

Section - 127 Certificate of registration

Section - 128 Endorsement of certificate of registration on debenture or certificate of debenture stock

Section - 129 Duty of company and right of interested party as regards registration

Section - 130 Copy of instrument creating mortgage or charge to be kept at registered office

Section - 131 Rectification of register of mortgages

Section - 132 Registration of payment or satisfaction of mortgages and charges

Power of Registrar to make entries of satisfaction and release in absence of intimation
Section - 133
from company
Section - 134 Penalties

Section - 135 Company's register of mortgages

5
 COMPANY LAW MODULE - D Study Plan

REFERENCE (BOOK PAGE NUMBER) REGISTER

REVISION REVISION
SECTION NO. DESCRIPTION Companies PAGE DONE
PAC ATFL KP NO.1 NO.2
Ordinance, 1984 NUMBER
Right to inspect copies of instruments creating mortgages and charges and company's
Section - 136
register of mortgages
RECEIVERS AND MANAGERS
Section - 137 Registration of appointment of receiver or manager

Section - 138 Filing of accounts of receiver or manager

Section - 139 Disqualification for appointment as receiver or manager

Section - 140 Application to Court

Section - 141 Powers of Court to fix remuneration, etc., of receiver or manager

DIRECTORS
Section - 174 Minimum number of directors

Section - 175 Only natural persons to be directors

Section - 187 Ineligibility of certain persons to become director

Section - 217 Declaring a director to be lacking fiduciary behaviour

Section - 214 Disclosure of interest by director

Section - 215 Interest of other officers, etc.

Section - 216 Interested director not to participate or vote in proceedings of directors

Section - 176 First directors and their term

Section - 180 Term of office of directors

Section - 178 Procedure for election of directors

Section - 178A Fresh election of directors on request of substantial acquirer

Section - 179 Circumstances in which election of directors may be declared invalid

Section - 182 Creditors may nominate directors

Section - 184 Consent to act as director to be filed with registrar

Section - 177 Retirement of directors

Section - 181 Removal of director

Section - 188 Vacation of office by the directors

Section - 195 Loans to directors, etc.

Section - 183 Certain provisions not to apply to directors representing special interests

Section - 185 Validity of acts of directors

Section - 186 Penalties

Section - 189 Penalty for unqualified person acting as director, etc.

Section - 190 Ineligibility of bankrupt to act as director, etc.

Section - 191 Restriction on director's remuneration, etc.

Section - 192 Restriction on assignment of office by directors

Section - 193 Proceedings of directors

Section - 194 Liabilities, etc., of directors and officers

6
 COMPANY LAW MODULE - D Study Plan

REFERENCE (BOOK PAGE NUMBER) REGISTER

REVISION REVISION
SECTION NO. DESCRIPTION Companies PAGE DONE
PAC ATFL KP NO.1 NO.2
Ordinance, 1984 NUMBER

Section - 111 Limited company may have directors with unlimited liability

Section - 112 Special resolution of limited company making liability of directors unlimited
Disclosure to members of directors interest in contract appointing chief executive,
Section - 218
managing agent or secretary
Section - 222 Submission of statements of beneficial owners of listed securities

Section - 223 Prohibition of short-selling

Section - 224 Trading by directors, officers and principal shareholders

Section - 196 Powers of directors

CHIEF EXECUTIVE
Section - 198 Appointment of first chief executive

Section - 199 Appointment of subsequent chief executive

Section - 200 Terms of appointment of chief executive and filling up of casual vacancy

Section - 201 Restriction on appointment of chief executive

Section - 202 Removal of chief executive

Section - 203 Chief executive not to engage in business competing with company's business

Section - 204 Penalty

SECRETARY

Section - 204A Certain companies to have Secretaries

BAR ON APPOINTMENT OF MANAGING AGENTS, SOLE PURCHASE AND
SALES AGENTS, ETC.
Section - 206 Bar on appointment of managing agents, sole purchase, sales agents, etc.

Section - 207 Terms and conditions of appointment of managing agent

ACCOUNTS
Section - 230 Books of accounts to be kept by the company

Section - 231 Inspection of books of account by registrar, etc.

Section - 232 Default in compliance with provisions of section 231

Section - 233 Annual accounts and balance-sheet

Section - 234 Contents of balance-sheet

Section - 234A Special Audit

Section - 241 Authentication of balance-sheet

Section - 242 Copy of balance-sheet to be forwarded to the registrar

Section - 243 Right of member of company to copies of the balance-sheet, etc. and the auditor's report
Penalty for improper issue, circulation or publication of balance-sheet or profit and loss
Section - 244
account
Section - 245 Quarterly accounts of listed companies
Power of Commission to require submission of additional statements of accounts and
Section - 246
reports
Section - 235 Treatment of surplus arising out of revaluation of fixed assets

7
 COMPANY LAW MODULE - D Study Plan

REFERENCE (BOOK PAGE NUMBER) REGISTER

REVISION REVISION
SECTION NO. DESCRIPTION Companies PAGE DONE
PAC ATFL KP NO.1 NO.2
Ordinance, 1984 NUMBER

Section - 236 Directors' report

Section - 237 Consolidated financial statements.

Section - 238 Financial year of holding company and subsidiary

Section - 239 Rights of holding company's representatives and members

Section - 240 Balance-sheet of modaraba company to include modaraba accounts, etc.

AUDIT
Section - 252 Appointment and remuneration of auditors

Section - 253 Provisions as to resolutions relating to appointment and removal of auditors

Section - 254 Qualification and disqualification of auditors

Section - 255 Powers and duties of auditors

Section - 256 Reading and inspection of auditor's report

Section - 257 Signature on audit report, etc.

Section - 258 Audit of cost accounts

Section - 259 Penalty for non-compliance with provisions by companies

Section - 260 Penalty for non-compliance with provisions by auditors

DIVIDEND
Section - 248 Certain restrictions on declaration of dividends

Section - 249 Dividend to be paid only out of profits

Dividend not to be paid except to registered shareholders or to their order or to their
Section - 250
bankers
Section - 251 Period for payments of dividend

MEETINGS AND PROCEEDINGS

Section - 157 Statutory meeting of company

Section - 158 Annual general meeting

Section - 159 Calling of extra ordinary general meeting

Section - 197 A Prohibition regarding distribution of gifts

Section - 160 Provisions as to meetings and votes

Section - 160 A Circumstances in which proceedings of a General Meeting may be declared invalid.

Section - 161 Proxies

Section - 165 Voting to be by show of hands in first instance

Section - 167 Demand for poll

Section - 168 Time of taking poll

Section - 166 Chairman's declaration of result of voting by show of hands to be evidence

Section - 164 Notice of resolution

Section - 169 Resolution passed at adjourned meeting

8
 COMPANY LAW MODULE - D Study Plan

REFERENCE (BOOK PAGE NUMBER) REGISTER

REVISION REVISION
SECTION NO. DESCRIPTION Companies PAGE DONE
PAC ATFL KP NO.1 NO.2
Ordinance, 1984 NUMBER

Section - 170 Power of registrar to call meetings

Section - 171 Penalty for default in complying with the directions of the registrar for holding the meeting

Section - 172 Filing of resolution, etc.

Section - 173 Minutes of proceedings of general meetings and directors

Section - 162 Representation of corporations at meetings of companies and of creditors

Section - 163 Representation of Federal Government, etc., at meetings of companies

CONTRACT
Section - 210 Form of contract

Section - 225 Contracts by agents of company in which company is undisclosed principal

Section - 211 Bills of exchange and promissory notes

Section - 212 Execution of deeds

MISCELLANEOUS
Section - 213 Power for company to have official seal for use abroad

Section - 227 Employees' provident funds and securities

Section - 228 Right to see bank receipts for money or securities

Section - 229 Penalty for contravention of section 226, 227 or 228

Section - 197 Prohibition regarding making of political contributions

INVESTMENT
Section - 208 Investments in associated companies and undertakings

Section - 209 Investments of company to be held in its own name

REGISTER OF MEMBERS, DEBENTURE-HOLDERS, DIRECTORS & OTHER
OFFICERS
Section - 147 Register of members and index

Section - 149 Register and index of debenture-holders

Section - 205 Register of directors, officers, etc.

Section - 148 Trusts not to be entered on register

Section - 156 Annual list of members, etc.

Section - 150 Inspection of registers

Section - 151 Power to close register

Section - 152 Power of Court to rectify register

Section - 153 Punishment for fraudulent entries in and omission from register

Section - 154 Notice to register of rectification of register

Section - 155 Register to be evidence

Register of contracts, arrangements and appointments in which directors, etc., are
Section - 219
interested
Section - 220 Register of directors' shareholdings, etc.

9
 COMPANY LAW MODULE - D Study Plan

REFERENCE (BOOK PAGE NUMBER) REGISTER

REVISION REVISION
SECTION NO. DESCRIPTION Companies PAGE DONE
PAC ATFL KP NO.1 NO.2
Ordinance, 1984 NUMBER

Section - 221 Duty of directors, etc. to make disclosure of shareholdings, etc.

SERVICE AND AUTHENTICATION OF DOCUMENTS

Section - 48 Service of documents on company

Section - 49 Service of documents on registrar

Section - 50 Service of notice on members, etc.

Section - 51 Authentication of documents and proceedings

POWER OF REGISTRAR TO CALL FOR INFORMATION, ETC.

Section - 231 Inspection of books of account by registrar, etc.

Section - 261 Power of registrar to call for information or explanation

Section - 262 Seizure of documents by registrar

SECURITIES AND EXCHANGE COMMISSION OF PAKISTAN (SECP)

Section - 12 Powers and functions of the Commission

Section - 13 Reference by the Federal Government or Commission to the Court

SECP ACT, 1997

JURISDICTION OF COURTS
Section - 7 Jurisdiction of the Courts

Section - 8 Constitution of Company Benches

Section - 9 Procedure of the Court

Section - 10 Appeals against Court orders

10