1. The petitioner filed the present petition under section 38 of the Companies Act, 1913 in a representative capacity. He has made an application under Order I, rule 8, C. P. C., stating that he and many other nationals of Pakistan, were entitled to similar relief as claimed by him. By an order on C. M. A. No. .112/1976, dated 14-2-1977, two intervenors, namely, National Invest--ment Trust, and the National Bank of Pakistan have also been joined as co petitioners for the reason of their having identical interest in this application. This application was resisted by the Administrator of Abandoned Properties. At the time of hearing, Mr. Kamai Azfar appeared for the petitioner.
2. Maudood Ahmed Farooqui, Mr. Akhtar Mahmood for the two intervenors, who were joined by order, dated 14-2-1977. Mr. Mamnoon Hassan for the respondent Amin Fabrics and Mr. Shah Jamil Alam for the Administrator of Abandoned Properties. For the sake of convenience National Investment Trust and the National Bank of Pakistan are hereinafter referred to as the Intervenors, and the Administrator of Abandoned Properties is hereinafter referred to as the Administrator.
3. The circumstances in which this application was filed may be briefly stated as follows :- The petitioner and the intervenors owned shares in Amin Jute Mills Ltd., which was incorporated in what was previously East Pakistan. This Company was located in East Pakistan, and, even after the enactment of Abandoned Properties (Taking Over and Management) Act XX of 1975, they have not shifted their registered office in pursuance of the Companies (Shifting of Registered Office)
4. Ordinance V of 1972. This Company, therefore, is a "specified person" within the meaning of clause (f ) of section 2 of the Abandoned Properties (Taking Over and Management) Act of 1975. On 21st November, 1970, the Board of Directors of Amin Jute Mills Ltd., took some decisions relating to the dividends for share-holders for the year ending 30th June, 1970. The decision was to pay the dividend at the rate of 10 % on Rs.32,31,792 fully paid up shares of the Company and they recommended pay--ment of a sum amounting to Rs.16,15,896 in-the form of fully paid up shares of Amin Fabrics Ltd. For every twenty shares held by, the share-holders in Amin Jute Mills Ltd. At this stage, it may be clearly stated that Amin Fabrics Ltd. Has been referred to by the Advocates as a sister concern of Amin Jute Mills Ltd. But incorporated in the areas now forming Pakistan, and, for such reason, is immune from the operation of the Abandoned Properties Act. It is then the case of the petitioner that, on account of the tragic events of 1971, the physical distribution of share certificates of Amin Fabrics Ltd. Could not be made, but thereafter the petitioners have been demanding their shares certificates from Amin Fabrics Ltd. And asking for registration of their shares in the registers of the Company, and such relief has been refused by the respondent Amin Farbics Ltd. Mr. Abdul Khaliq a Director of Amin Fabrics Ltd. Has filed an afiidvit, stating that the facts stated in the petition are not disputed, and further stating, in paragraph 5 of his affidavit, that the respondents had been advised that, according to law and equity, the petitioners and many other Pakistani shareholders have a right to the share of Amin Fabrics Ltd. In paragraph 6 of his affidavit, he has stated as follows :- "6. That in the light of the notices that have been published pursuant to the present proceedings and in the light of no adverse claim/objection having been filed by any person including the Administrator, Abandoned Properties, who has been specifically notified, the respondent has now no objection in issuing the share certificate to the petitioner and to other bona fide Pakistani share- holders unless this Honourable Court decides to the contrary."
5. It would thus seem that, by and large, the respondent has supported the case of the petitioners, and has been deterred from registering the shares in the names of the petitioners to save himself from the peril of contravention of the Abandoned Properties Act. On behalf of the Administrator, an affidavit has been filed by Mr. M. Y. Burney, a Director in the Abandoned Properties Organization. It is stated in the affidavit that Amin Jute Mills Ltd. Has not shifted its office to the territories now comprising Pakistan. It is admitted that the dividends were declared on 21st November, 1970, but it is. Stated that "it is not understood bow the dividends declared by Amin Jee Mills Ltd. Were not paid before the fall of Dacca, which took place in December, 1971". It is further averred that, since the dividends had not been paid, the same revert to Amin Jute Mills Ltd. And therefore become abandoned property, and, for such reason, vest in the Federal Government. Reliance in that context is placed on section 3 of the Act. It is further stated that, if the petitioners were dissatisfied with the order, or, decision of the Administrator, they could have filed an appeal under section 15 of the Act, and admittedly such appeal has not been filed.
6. Mr. Kamal Azfar and Mr. Akhtar Mahmood Khan, for the petitioners, have contended that the dividend was transferred to Amin Fabrics Ltd., and, since this Company is not a "specified person" within the meaning of section 2 (f ) of the Act, the property consisting of the shares could not be termed as abandoned property. The point is explained on the premises that Amin Jute Mills Ltd.
7. Had already paid the dividends, and Amin Febrics Ltd. Were only distributing the share. In other words, it is contended that it was not a case of unpaid dividend still in custody of Amin Jute Mills Ltd., and therefore the Act did not apply. Additionally, it is contended that the relief sought was in the nature of equitable relief, and, since equity regards that as done which ought to be done, the respondent should be ordered to register the shares. It is further contended that dividend of Amin Jute Mills Ltd. Has not been notified under section I 1 of the Act as abandoned property. In that context, it may be pointed out that Mr. Burney, who has filed the affidavit on behalf of the Administrator, has produced a copy of a notification under section 11 of the Act issued on 26th August 1975, by the Cabinet Division of the Government of Pakistan, wherein the shares of Amin Jute Mills Ltd., in favour of Messrs National Refinery Ltd. Has been treated as abandoned property.
8. No doubt, this notification makes no reference to the shares of Amin Fabrics Ltd., which have been issued as dividend by Amin Jute Mills Ltd., I pointedly asked Mr. Kamal Azfar and Mr. Akhtar Mahmood, whether this Court had the jurisdiction to question the actions of the Administrator, who, for reasons which may be good, bad, or indifferent, has chosen to treat the property as abandoned property. The learned advocates replied that the property in this case, namely, the shares of Amin Fabrics Ltd. Had not been notified under section 11 of the Act, and reiterated the argument that Amin Jute Mills Ltd. Had diverted itself of the dividend payable to the share-holders, and therefore the shares of Amin Fabrics Ltd. Could not be deemed as abandoned property. Mr. Shah Jamil Alam has contended that, in spite of lack of notification under section 11 of the Act, the property could be treated as abandoned property. He has contended that the shares had not been transferred by Amin Jute Mills Ltd. He has further stated that equitable considerations would not apply to the case in hand, because the interest of the Administrator has to be determined in accordance with enacted law. He has also relied on section 10 of the Act to contend that there was a total bar t o the exercises of jurisdiction of this Court. He has pointed out that the requirements of section 28 of the Companies Act in respect of transfer of shares have not been complied with, and therefore the petition was not maintainable.
9. The first point for consideration is as to the effect of lack of publication of notification to the property in question under section 11 of the Act. While the case of the petitioners is that no property can be deemed to be abandoned property, unless such status of the property is notified under section 11 of the Act, Mr. Shah Jamil Alam has contended that the property shall vest in the Administrator in spite of lack of publication. He has relied on the provisions of sections 3 and 6 of the Act. In that context, it will be profitable to reproduce clauses (a) and (f ) of section 2, which define "aban--doned property" and "specified person". These clauses read as follows "(a) "abandoned property" means any property, movable or immovable (including share in industrial units and firms, investment, deposits, policies of insurance and all other interests and rights in or to or arising out of any such property), belonging to a specified person and includes.
10. Any such property sold or transferred to, or placed under the supervision or control of, any other person on or after the sixteenth day of December, 1971, but does not include any ornaments or wearing apparel or any cooking vessels or other household effects in the immediate possession of a specified person, not exceeding a total of rupees one thousand;"
(f) ---specified person' means a citizen of Pakistan domiciled in the territories which immediately before the sixteenth day of December, 1971, constituted the Province of East Pakistan who has left or leaves or has expressed his desire to be taken out of, or to. Be allowed to leave, the territories of Pakistan and includes a Company registered in the said territories the registered office of which has not been shifted in pursuance of the Companies (Shifting of Registered Office) Ordinance, 1972 (V of 1972) ;--- The next provision of the Act which deserves consideration in that contest is section 3 of the Act, which states that "all abandoned property shall vest and shall be deemed always to have vested in the Federal Government on and from the sixteenth day of December, 1971 ". The provisions of section 6 are also not out of point, because this section provides that any person, who is or has, at any time after the sixteenth day of December, 1971, been in possession or supervision or management of any abandoned property, shall be deemed to be holding such property on behalf of the Board of Trustees constituted under the Act. Such person is bound by law to submit full information relating to such property, and also a detailed account of rents and profits accrued from the property. Sub--section (3) of section 6, however, provides that such persons as are in possession of or holding any abandoned property may, on a notification issued by the Federal Government, intimate to the Administrator his willingness to surrender such property. On a conjoint regarding of sections 2, 3, 6 and 11, the position emerging is that property comes to be treated as abandoned property by operation of the provisions of the Act, and the consequences flowing from these sections take effect in spite of lack of notification under section I 1 of the Act. Section 11 only states that the Administrator has to publish by a notification the list of abandoned properties in any area. This section does not state that, unless a notification is published, the property is not, or, cannot be considered, or, treated as aban--doned property. There is no provision in the Act, detailing the consequences flowing from absence of publication of a notification under section 6
(3) of the Act. It would thus seem that the provisions of section 11 of the Act are of mandatory nature only to the extent as is referred to in section 6 (3) and no further. It does not provide a mandate for publication of the list of properties before treating the same as abandoned properties. If a property is abandoned, or, a person is a "specified person" by operation of the Act, the mere absence of publication in the Gazette will not alter, or, be deemed to alter the status of the property, or, person. In my view, the argument by Mr. Shah Jamil Alam is, substantial, and I agree with him.
11. The next point that has been canvassed by the learned advocates for the petitioners is in regard to the nature of jurisdiction that this Court can exercise. Mr. Kamal Azfar has contended that this jurisdiction is to regulated on the principles of equity, while, on the other hand, Mr. Shah Jamil Alam has contended that, since the matter involves a consideration of the rights of the Administrator, and such rights have been created by statute, equitable considerations cannot prevail. Mr. Kamal Azfar has relied on the case of Grindlay's Bunk Ltd. v. Murree-Brewery Co. Ltd. (PLD 1964 Lab. 745), which is the judgment of Muhammad Munir, C. J., who delivered the same on behalf of the D. B. In this case, the scope of section 38 of the Companies Act was examined. The question that arose was, whether the ostensible owner of a share, whose name is - borne on the register of members, may or may not vote at a General Meeting of the Company. This case is hardly of any application in the present circumstances. The next case relied on by Mr. Kamal Azfar is the President's Reference reported in PLD 1971 SC 585. He referred to a passage appearing in the judgment of Hamoodur Rahman, Chairman, in .Which the doctrine of tearing of veil of incorporation was referred to. The passage appears at page 616 of Report. Mr. Kamal Azfar stated that it was permissible for this Court to enter into the question of finding, whether the shares of Amin Fabrics Ltd., decided by Amin Jute Mills Ltd. To be given as dividend on the shares of Amin Jute Mills Ltd. In fact, continue to be the property of the latter Company. This argument completely loses sight of the fact that the dispute in the present case is mainly between the Administrator and Amin Fabrics Ltd. The Administrator is acting in pursuance of statute and therefore the doctrine of tearing of veil is completely foreign in the context. Mr. Kamal Azfar next invited my attention to topic 447 at 217 of Volume 6 of Halsbury's Laws of England (3rd Edition). He has pointed out the following passage :- "The jurisdiction is discretionary. It is not limited by the provisions of the Companies Act, 1948, to the case abovementioned; thus the Court will rectify the register, apart from the Act, to enable the members of a Company to have a fair and reasonable exercise of their rights.
12. When the Court entertains the application it is bound to go into all the circumstances of the case, and to consider that equity the applicant has to call for its inter-positions."
13. While I respectfully agree that, in matters relating to rectification of the register, the Court has the power to enter into all circumstances of the case and to grant equitable relief but, in the case in hand, the dispute has not been raised by Amin Fabrics Ltd., but by the Administrator. The point that falls for consideration is, whether the Administrator is justified in claiming the shares as abandoned property. In such context, the learned Advocate for the petitioner has also referred to the case of Dalmier v. Ltd. (1916 17 A E R 191 (HL)), the case of Kantilal Manilal (30 I T R 569 (Boni.)) and also the case of Travor v. Whitworth (57 L T R 457 (HL)). All these cases relate to the doctrine of tearing of Veil, and seem to establish that jurisdiction under section 38 of the Companies Act is equitable jurisdiction, when the Court has to look for resolution of the disputes on principles of equity and good conscience. There is no quarrel with that proposition. If the disputes were only between the Company and the share-holders, the principles will be attracted with full force, but, in the present case, the dispute is not between the Company and the share-holders, and it is a dispute between the Company and the share-holders on the one hand and the Administrator of Abandoned Property on the other. The Administrator is acting in pursuance of a statute, and in exercise of statutory powers. His actions are to be regulated by the scheme of the Act, and his actions could be challenged under section 15 of the Act itself, or by a petition under Article 199 of the Constitution.
14. Equitable considerations, therefore, do not prevail in these circumstances, and I am mainly concerned with determination of the correctness of the acts of the Administrator, rather than with Amin Fabrics Ltd. It was precisely for that reason that the Administrator has appeared in this case to resist the application.
15. "(40) The instrument of transfer of any shares shall be signed both b the transferor and transferee and shall contain the name and address and occupation both of the transferor and transferee, shall be duly stamped and the transferor shall be deemed to remain the holder of such share until the name of transferee is entered in the register in respect thereof, each signature to such transfer instrument shall be dull attested by the signature of one creditable witness who shall add his address and occupation."
16. It would seem that several formalities needed compliance in order to effect the transfer of shares of Amin Fabrics Ltd., and it is not case of the) petitioner that such compliance has been made. In that regard, the Articles of Association also provide for a form of transfer, and such form also admittedly has been filled up" It would thus seem that no transfer by Amin Jute Mills Ltd., has been made in a manner as is contemplated by Articles 40 and 43, and, since section 28 of the Companies Act provides that shares are to be transferred in the manner provided by the Articles of Association, the only correct conclusion is that the shares of Amin Fabric Ltd., continue to be the property of Amin Jute Mills Ltd., and the latte being a "specified person" within the meaning of the Act, the Administrator has the right to forbid Amin Fabrics Ltd., from transferring the shares in C favour of the petitioners. In that context, it may also be considered as t what is the effect of a declaration of dividend. Often an argument is raise that, on a declaration of dividend, the said dividend and the assets correspon--ding . Thereto cease to appertain to the business, but belong to the Company. This aspect is dealt with in Palmer's Company Law, 20th Edn. In which the legal position is stated at page 625 in the following words :- "Where a dividend is declared and becomes payable, it is a debt in England as will be explained in the following section, - a special debt and each share-holder is entitled to sue the Company for his proportion. Until the dividend is declared and payable, the share-holder has no right to sue 7"
17. It would thus seem that, until the actual payment of the dividend, or, transfer of the interest, such money of the dividend, or, interest is to be treated as a debt owing to the share-holders, but being held by the Company that declares the dividend. In the present case also, since admittedly the share certificates of Amin Fabrics Ltd., had not been delivere to the petitioners, their interest or dividend cannot but be considered as a debt which Amin Jute Mills Ltd., has to pay to the petitioners. That being so, the Administrator appeared to be justified in taking the action, which is impugned in this petition.
18. The last point that has engaged m5 attention concerns to bar of jurisdiction of this Court imposed by section 10 of the Act. This provision reads as follows :- "10. Exemption from legal process.-(1) Property which has vested in the Federal Government or of which possession has been taken by the Administrator shall be exempted from all legal process, including seizure, distress, ejectment, attachment or sale by any officer of a Court or any other authority, and no injunction or other order of whatever kind in respect of such property shall be granted or made by any Court or any other authority, and the Federal Government shall not be divested and the Administrator shall not be dispossessed of such property by operation of any law for the time being in force."
19. On a plain reading of the provision, there cannot be two opinions that bar is total and complete.
20. This Court, while exercising its original Civil Jurisdiction, cannot enter into the questions which have to be decided be the functionaries in the scheme of the Act itself. This application is, therefore, liable to fall even on this point. `M This application is dismissed, but it shall be open to the petitioner to avail of the remedy provided by section 15 of the Act, or, any other provision contained therein.