This Order shall dispose of the proceedings initiated against the Directors of M/s. Mubarik Dairies Limited (hereinafter referred to as the "Company") for default made in complying with the provisions of Sub-section (1) of Section 245 of the Companies Ordinance, 1984 (the "Ordinance").
2. The facts leading to this case, briefly stated, are that in terms of the provisions of Section 245 of the Ordinance, the Company was required to prepare and transmit to the members and simultaneously file with the Registrar and the Commission its quarterly accounts for the 1st quarter ended on September 30, 2004 and 2nd quarter ended December 31, 2004 by October 31, 2004 and February 28, 2005 respectively. The Company failed to file the aforesaid accounts with the Commission within the prescribed time. The failure of the Company to comply with the aforesaid requirements necessitated action against the Directors of the Company in terms of Sub-section
(3) of Section 245 of the Ordinance. Consequently, show cause notices dated February 07, 2005 and April 01, 2005 were served on all the Directors including the Chief Executive of the Company calling upon them to show cause as to why penalties as provided under Sub-section (3) of Section 245 read with Section 476 of the Ordinance may not be imposed on them.
3. No response was received from the Directors of the Company to the aforesaid notices. In order to give an opportunity of personal hearing, the hearing in case of show cause notice dated February 07, 2005 was fixed for March 24, 2005. However, no one appeared for hearing on the given date and time. To provide final opportunity, the matter was again fixed in case of both the notices on May 09, 2005 with the advice that in case the Chief Executive and Directors fail to attend the hearing, their cases will be decided on merit in accordance with law on the basis of well settled principles of natural justice and record available on the file. Again no one appeared on the date of hearing to defend the case. However, a letter dated May 07, 2005 was received from M/s. Sarwar Awan & Co., Chartered Accountants, on behalf of the Directors of the Company wherein request for adjournment of hearing up to June 07, 2005 was made on the plea that the working Director of the Company was out of town due to which they were unable to get the required information to present the case before the Commission. The plea taken by the consultants of the Directors for adjournment of hearing till June 07, 2005 was not found cogent as the Chief Executive and Directors of the Company have already been given ample time to respond to show cause notices and also two opportunities for personal hearings but they failed to attend hearings on both the occasions nor did they respond to the show cause notices and earlier notices of hearings. In the circumstances, I proceed to decide this case on its merits.
4. It is the duty of the Directors of the Company to ensure compliance with all the statutory requirements. Accordingly, the Directors of the company are responsible for timely preparation and submission of quarterly accounts to its members and file the same with the Registrar and the Commission within prescribed time, whereas they have failed to file the same with the Commission till to date even after issuance of show cause notices. This indicates that the Directors have no respect for the law and they have intentionally deprived the shareholders of their statutory right to receive the quarterly accounts of the Company. The Company has also not been compliant to the statutory provisions of law in the past in submission of quarterly accounts. I am, therefore, constrained to believe that the Company and its Directors including the Chief Executive have willfully and deliberately committed the defaults in preparation, circulation and filing of aforesaid quarterly accounts, which is established from record.