1. ' These applications for injunction and appointment of Receiver have been moved by the plaintiff.
2. In the first application No,2053 of 1985 it is to order that the defendant No,12 to stay the operation of all L/Cs opened by the defendants 4 to 6, to prohibit the defendants 1, 2 and 3 from entering into any contract, transaction or business with the Defence Purchase Department to stay all accounts operated by or in favour of the Defendant No,3, to prohibit defendants 1, 2 and 3 from entering into any contract and to appoint Receiver of the defendant No,3 to order the defendants to obey and carry out all orders of the Receiver. In the second application 4508 of 1985 it is prayed that defendant No,3 has been fraudulently promoted, incorporated and established and run for fraudulent dealing. The defendant No,3 is given a similar name, to pass off for the original plaintiff No,l.
3. ' According to the plaint, the plaintiff No,1 is a private Limited Company and the directors held the company's issued capital of Rs,40,000 (divided into 4,000 shares),, each share of the nominal face value of Rs,10 as under:- S.NoName of the First Share holders and Directors.No. of Shares held.
4. (1)Aziz Wali Muhammad, the plaintiff No.2 1,000 (2)Azhar Wali Muhammad the defendant No.11,000 (3)Zafar Ara Begum, the defendant No.2 1,000 (4)Choudhry Chiraghdin, the deceased. 1,000 Total: 4,000 ' On 1-7-1982, the defendants 1 and 2 expressed their desire to withdraw from the company as shareholders and directors and agreed to surrender the shares held by each of them to the existing remaining shareholders that is, the plaintiff No,2 and as a result, thereof the plaintiff No,2 holds 80% of the shares in the issued capital of The company. The plaintiff No,2 until he became 80% shareholder was a 25% shareholder and the company was a private company of close family members each trusting the other and vitally interested in all aspects thereof and each, at all times, worked and carried on the business and conducted its affairs of the Company in a fiduciary capacity in oberrima fide relations of mutual trust. The Company secured agencies of famous foreign principals. However, the agency contracts, memorandum and other related documents on behalf of the company were signed by a single director namely defendant No,1. The company through its efforts application, goodwill and being agents of the famous military and other goods were registered as prominent suppliers of defence stores with Director-General Procurement, Controller of Military Accounts and Director-General Defence Purchase. The plaintiff No,2 did not participate in the day to day work of the company or its affairs and accounts which were conducted solely by the defendant No,1 As the defendant No,1 and the deceased Ch. Chiraghdin during his life and thereafter the defendant No,2 were keeping the affairs of the company in the dark they made dubious statements about its business affairs. A dispute arose which was the subject-matter of the agreement, dated 30-9-1976 between the plaintiff No,2 and the defendants Nos.1 and 2 Chiraghdin whereby they agreed and, admitted that the plaintiff has not received his share. It was further agreed that no party thereto shall withhold any information or accounts from the other relating to any business conducted by any of them under the name and style of plaintiff No,1 or any other. Finally on 2-7-1982 another agreement was entered into and executed between the parties. The defendant No,1 agreed to transfer his 2/7th undivided share in property bearing 30- A Block No,6 P.E.C.H.S. Ltd. He further undertook to transfer his 2/7th undivided share in property bearing No,23 West Wharf, Karachi. It was agreed that the plaintiff No,1 shall cease to operate as company after 30th June, 1983. By consent of parties the stipulation in the agreement for winding up was given up, not acted upon. By clause 16 (e) the defendant No,1 assured that he had not suppressed any business accounts, profits and affairs of the plaintiff ,No,1 and all such businesses, assets, profits and affairs of the plaintiff No,1 were truly reflected in the books/records and accounts of the company prepared and maintained by him. By clauses .17 and 18 it- was clearly stipulated between the parties that the defendant No,1 will run and enjoy the agency business mentioned in the clause 16 only subject to due performance and due fulfilment of the obligations mentioned therein implying therein, as a negative covenant, that in case the defendant No,1 failed to perform the stipulated obligations particularly those in para. 16, the defendant No,1 would not be entitled to run and enjoy the agency business mentioned in clause 16. The plaintiffs were at all times and are ready and are willing to perform their part of the obligations under these agreements The defendant No,1 without information of the plaintiff promoted and secured incorporation of the defendant N .3 to carry on the same business as was done by the plaintiff NO.
1. In the circumstances and the manner for bringing into existence of the defendant No,3, the business carried on by it shall be deemed to be the business of the plaintiff No,l.
5. ' Now I take up the case for defendants Nos.1, 2 and 3. The defendants denied contents of para. 3 of the affidavit. He also denied that the defendants fraudulently and wrongfully colluded to channel away the business and moneys of the plaintiffs. He has stated that the defendants Nos.1 and 2 have complied with major and conceivable conditions of the agreement. The defendant No,1 in his counter-affidavit to the supplementary affidavit has denied that the defendant No,3 was promoted for the purpose and in the manner enumerated therein or that the appointment of Receiver is warranted as a consequence thereof or, that the defendant No,3 is involved in any fraudulent or passing off aspect and antecedent to plaintiff No,1 as alleged. He has further - stated that the incorporation of the defendant No,3 is itself to be viewed as a perpetuation of the letter and spirit of the agreement, dated 2-7-1982 and not as a flagrant violation thereof as alleged by the plaintiffs.
6. ' The present suit has been filed by the plaintiff for various reliefs and the first application has been taken out by the plaintiffs for an injunction restraining the defendants Nos.1, 2 and 3 from entering into any contract, transaction or business with the defence purchase department of the Government of Pakistan and to stay all accounts operated by or in favour of the defendant No,3 to order the defendants 1, 2 and 3 not to receive in account any amount from defendants Nos.7-12 and to appoint Receiver of the defendant No,3 in respect of all its past/present/future business as also the business of the defendants Nos. 2 and 3 to order and direct the defendants 1, 2 and 3 to hand over all books and records of the plaintiff No,l. I passed following interim order on 3-12-1985.
7. "In the interest of justice I appoint Mr. Syed Abbas Zia Advocate as Receiver to take over all books of accounts and records of plaintiff No,1. The defendants Nos.1 and 2 are directed to hand over all the books of accounts records, documents to the receiver. The receiver is further directed to probe into all the contracts entered into by the defendant No,1 on behalf of the plaintiff No,1 during the period 2-7-1982 upto 30-5-1983. The plaintiffs are directed to pay tentatively Rs 5,000 as Receiver's fee."
8. ' The supplementary application has been taken out by the plaintiff for the appointment of the Receiver and to take charge of the business, management and affairs of the defendant No,3.
9. ' Mr. Mansoor Ahmed Khan appeared on behalf of the plaintiff has submitted that first of all an order for the appointment of Receiver be passed to take charge of the business, management and affairs of the defendant No,3. His case is that the defendant No,l had misappropriated or become liable or accountable to the plaintiff No,2 and was guilty of misfeasance, breach of trust and fraudulent conduct in relation to the plaintiff No,l. His further contention is that the defendant No,1 without information and knowledge of the plaintiffs promoted and secured incorporation of the defendant No,3 to carry out the same business as was done and being carried on by the plaintiff No,1. The constitution of the defendant No,3 remarkably followed the parties signing the agreement, dated 2-7-1982 which shows that the defendants Nos. 1 and 2 while executing the said agreement were quietly/secretly/surreptitiously working in the other direction of wrongful take over of the existing businesses/assets/benefits/goodwill/contracts of the plaintiff No,1 so as to destroy it,. I may now glance at the background led up to the filing of this suit, before I consider the issue raised in these applications.
10. ' The letter, dated 26-5-1977 of the defendant No,9 addressed to the plaintiff No,1 for attention of defendant No,1 came into the .Hands of the plaintiff No,2 after 1-7-1984. The plaintiff No,2 wrote to defendant No,9 to disclose the commission paid. In reply to which by letter, dated 15-8-1984, the defendant No,9 sent a statement of account showing that a sum of U.S $ 21,817.36 was due and payable in October, 1979 and last payment thereof was made to the defendant No,1 in November, 1984. The case of the plaintiff is that none of the payments appears in the books of account of the plaintiff No,1.
11. ' On the basis of the above letter it appears that the defendant No,1 was conducting plaintiff's No,1 affairs in a manner detrimental to the interest of the plaintiff No,2.
12. ' The contention of the learned counsel for the plaintiff is that the defendant No,1 is liable for negligence and misappropriation of funds of the plaintiff No,l. He placed reliance on the case of City Equitable Life Insurance Co. 1925 Ch. 407 at p.427 Dowy v. Corry 1901 A C 477.
13. There is a fiduciary relationship between a director and the company. A director. Therefore, has always to act in good faith vis-a-vis the company. It is necessary first to understand the scope of the, fiduciary nature of the relationship on which this argument is built. Directors have been held to be sometimes agents of the company. They are also understood to be trustees so far as the company's property and its funds in their hands are concerned. Courts of law have considered and treated them as trustees of money which comes into their hands and once it is proved that they have misapplied or misused such money, they were held liable to make good those moneys In here I may refer to Regal (Hastings) Ltd. v. Gulliver and others (1942) 1 A E R 378, the House of Lords observed thus: "Directors of a limited company are the creatures of statute and occupy a position peculiar to themselves. In some respects they resemble trustees, in others they do not "
14. ' The House of Lords considered various authorities dealing with this question, and it was decided that the powers of the directors were in some sense fiduciary in relation to the company. On the facts of that case, directors who had made some profits by virtue of their position involving a cinema house and a subsidiary company, it was held that the rule of equity which insists on those who by user of a fiduciary position make a profit should account for it, is not dependent on fraud or absence of bona fides but by virtue of their position as trustee. In Selangor United Rubber States, Ltd. v. Credock (1968) 2 AER 1073 Ch. D the first question of law discussed was how far directors are trustees of the company's funds and while answering this question, the discussion proceeded on the assumption that there existed a fiduciary relationship between the director and the company which is clear from the following observation 1091:- "It is clear and not disputed that they owe a fiduciary duty to the company to apply its assets only for the purpose of the company and are therefore liable for breach of that duty; but the question how far they are trustees bears on the question how other defendants can be made liable as constructive trustees . As claimed."
15. ' On occasion directors have been said to be trustees and on occasion not to be trustees.
16. ' The following observation In re: Forest of Dean Coal Mining Company (1879) 10 Ch. D 450 was noted with approval p.453: "Again, directors are called trustees. They are no doubt trustees of assets which have come into their hands, or which are under their control but they are not trustees of a debt due to the company. The company is the creditor, and, as I said before, they are only the managing partners.
17. In my opinion it is extravagant to call them trustees of a debt when it has not been received. You may of course have an actual trust of a debt, as in the case I put before where trustees have assigned to them a debt to get in, but that is not the case with directors of a company. A director is, the managing partner of the concern, and although a debt is due to the concern I do not think it is right to call him a trustee of that debt which remains unpaid, though his liability in respect of it may in certain cases and in some respects be analogous to the liability of a trustee. So much for the question of unpaid debts."
18. ' And the discussion on this question was wound up as follows:- "So in my view, in general as in this case a credit in a company's bank account which the directors are authorised to operate are moneys of the company under the control of those directors and are held by them on trust for the company in accordance with its purposes."
19. ' From the above discussion, it has been held that there exists a sort of fiduciary relationship between the directors and the company and that the law requires the directors to deal with the moneys and properties of the company as trustees. The contention that the plaintiff put forward on this basis is that once the fiduciary relationship mentioned above is accepted, the burden to satisfy the Court of the good faith in transaction, the bona fides of which are questioned by a director or shareholder shifts to the director and that the shareholder need only adduce some prima facie evidence.
20. ' In Re: City Equitable Life Insurance Co. 1925 Ch. 407 at p.427 which is regarded as the Locus Classiers on the subject was relied upon by the counsel for the plaintiffs. Romer, J., after considering earlier authorities, said: "In order, therefore, to ascertain the duties that a person appointed to the board of an established company undertakes to perform, it is necessary to consider not only the nature of the company's business, but also the manner in which the work of the company is in' fact distributed between the directors and the other officials of the company, provided always that this distribution is a reasonable one in the circumstances, and is not inconsistent with any express provisions of the articles of association. In discharging the duties of his position thus ascertained a director must, of course, act honestly; but he must also exercise some degree of both skill and diligence required of him, the authorities do not, I think, give any very clear answer. It has been laid down that so long as a director acts honestly he cannot be made responsible in damages unless guilty of gross or culpable negligence in a business sense. But as pointed out by Neville, J in In re: Brazilian Rubber Plantations and Estates, Ltd. One cannot say whether a man has been guilty of negligence, gross or otherwise, unless he can determine what is the extent of the duty which he is alleged to have in understanding the difference between negligence and gross negligene, except in so far as the expressions are used for the purpose of drawing a distinction between the duty that is owed in one case and the duty that is owed in another.
21. ' There are, in addition, one or two other general propositions that seem to be warranted by the reported cases: (1) A director need not exhibit in the performance of his duties a greater degree of skill than may reasonably be expected from a person of his knowledge and experience. A director of a life insurance company, for instance, does not guarantee that he has the skill of an actuary or of a physician. In the words of Lindley M.R.: "If directors act within their powers if they act with such care as is reasonably to be expected from them, having regard to their knowledge and experience, and if they act honestly for the benefit of the company they represent they discharge both their equitable as well as their legal duty to the company": See Lagunas Nitrate Co. v Lagunas Syndicate.
(1) It is perhaps only another way of stating the same proposition to say that directors are not liable for mere errors of judgment. (2) A director is not bound to give continuous attention to the affairs of his company. His duties are of an intermittent nature to be performed at periodical board meetings, and at meetings of any committee of the board upon which he happens to be placed.
22. He is not, however, bound to attend all such meetings though he ought to attend whenever, in the circumstances, he is reasonably able to do so. (3) In respect of all duties that, having regard to the exigencies of business, and the articles of association, may properly be left to some other official, a director is, in the absence of grounds for suspicion, justified in trusting that official to perform such duties honestly."
23. ' In Dovey and The Metropolitan Bank (of England and Wales) Ltd. v. John Cory 1901 A C 477, the question considered by the House of Lords was whether a director, though in fact innocent of any complicity in fraud, was liable to the company for negligence in not having discovered the fraud perpetrated by others. In that context, Lord Halsbury L.C. Had observed: "It is obvious if there is such a duty it must render anything like an intelligent devolution of labour impossible. Was Mr. Cory to turn himself into an auditor, a managing director, a chairman, and find out whether auditors, managing directors, and chairmen were all alike deceiving him ? That the letters of the auditors were kept from him is clear. That he was assured that provision had been made for bad debts, and that he believed such assurances, is involved in the admission that he was guilty of no moral fraud; so that it comes to this, that he ought to have discovered a network of conspiracy and fraud by which he was surrounded and found out that his own brother and the managing director (who have since been made criminally responsible for frauds connected with their respective offices) were inducing him to make representations as to the prospects of the concern and the dividends properly payable which have turned out to be' improper and false. I cannot think that it can be expected of a director that he should be watching either the inferior officers of the bank or verifying the calculations of the auditors himself . The business of life could not go on if people could not trust those who are put into a position of trust for the express purpose of attending to details of management."
24. ' In this very case, Lord Davey said: "I think the respondent (Cory) was bound to give his attention to and exercise his judgment as a man of business on the matters which were brought before the board at the meetings which he attended, and it is not proved that he did not do so. But I think he was entitled to rely upon the judgment information, and advice of the chairman and general manager, as to whose integrity, skill, and competence he had no reason for suspicion:"
25. ' In Re: Denham & Co. (:1883) 25 Ch. D 752, a director was held not liable for the fraud of his co- directors in issuing false and fraudulent reports and balance sheets. But even in this -case, it was found that the books of accounts of the company had been properly kept and duly audited so that the Director concerned had no reason for suspecting fraud and was misled "by reason of the extraordinary powers conferred by the Articles upon the chairman."
26. ' In Palmer's "Company Law "(22nd Ed 1976, p.68), after a citation of the three cases mentioned above, I find the following comments: "It is doubtful whether, if similar facts arose today, the Court decide in the same manner because now a days the Courts take a stricter view of the duties of a director than they took in the last century."
27. I am of the opinion that the Court will, as with trustees, not allow a director to retain any profit which he may make by virtue of the fact that he is a director. He will be liable to the company for that profit.
28. ' It is certainly a question of fact, to be determined upon the evidence to be adduced in this case, whether the defendant No,1 alleged to be liable for misfeasance, had acted reasonably as well as honestly and with due diligence, so that he could not be held liable for fraud and misappropriation .
29. Mr.Mansoor Ahmed Khan, the learned counsel for the plaintiff has submitted that first of all an order for an appointment of Receiver in respect of the defendant No,3 be passed. He has submitted that the Court has ample power to appoint a Receiver.
30. ' On the other hand Mr. Q.H. Sayeed, the learned counsel for the defendants 1, 2 and 3 has contended that defendant No,3 is a distinct entity and no Receiver can be appointed.
31. I find no provision in the Companies Act which excludes the jurisdiction of a Court to appoint a Receiver though since the Companies Act, 1913 and the Companies Ordinance, 1984 make provision for dealing with circumstances in which a company is mismanaged, it should not be necessary in the vast majority of cases to appoint a receiver. It might even be improper to do so in certain circumstances. My attention has been drawn to a number of instances in which receivers have been appointed and although the particular case that I am here considering does not fall within one of the categories of cases in which receivers have been appointed by Courts, I think this is a case in which, if the allegations are accepted, the appointment of a receiver would be the most satisfactory way of dealing with the temporary difficulty that exists during the pendency of the suit.
32. If the allegations of plaintiff be true the business of defendant No,3 shall be deemed to be the business of plaintiff No,1 and seek in their suit to have it declared that all the business of defendant No,3 shall be the business of the plaintiff No,1. Therefore, in my view it is possible in- suitable cases under the Companies Act as well as under the Companies Ordinance to appoint receiver who may take up the business of a company and the management of its property and its affairs pending the decision of the Court in this suit.
33. ' The plaintiffs have disclosed at this stage more than sufficient materials to establish a prima facie case and to show a serious question to be tried that the incorporation of defendant No,3 was well designed and kept under the control of first defendant.
34. ' Mr. Q.M. Sayeed, the learned counsel for the defendants Nos.1, 2 and 3 has submitted that at the interlocutory stage the Court must examine the prima facie case and see whether there is a serious question to be tried after weighing all the relevant facts and also probability according to the ordinary human behaviour and conduct and must feel the situation what can be called the appreciation of the existing facts appearing from the materials before the Court and realities of the situation. After all Court is not a computer or without any mind so as not to have any feeling at this stage but proceed on mere technicalities and rules of pleadings and some decisions on various aspects of the matter. At this stage it appears to me that there is not only prima facie case made out by the plaintiff but a very serious question which is analogous to fraud, wrongful acts on the part of the first defendant has been disclosed and very serious question as to the interpretation of the agreements. Articles and provisions of the Companies Ordinance, are to be gone into. The allegation that the first defendant diverting business in the third defendant of which has been he is one of the directors, makes out a prima facie case at this stage for an interim order. The administration of the third defendant cannot be left in the hands of the first defendant against whom serious allegations have been made in the plaint which appears to be, prima facie, maintainable and the balance of convenience appears to me to be in favour of proper order to be made for the protection of the company's books, assets and funds until further order. The principle is now well settled by the House of Lords decision in American Cynamid Co. v. Ethican Ltd. (1975) 1 A E R 504 and the Court of Appeal decision in Followes and Co. v. Fisher (1975) 2 A E R 829. Our Supreme Court laid down the following dictum in Sui Gas Transmission Company v. Sui Gas Employees Union 1977 SCMR 220.
35. "With respect to the learned Judge, an error has crept in his approach to the case. In dealing with an application for an Interim injunction the foremost consideration is to determine whether the plaintiff has made out a prima facie case. A prima facie case is spelt out if a serious question of fact or law is raised in the plaint on which the parties will go to trial.. The learned Judge was, however, influenced by the consideration that the defendants had 'raised serious questions as to the maintainability of the suit' but without identifying why the suit was not maintainable. An objection of this nature will prevail only if the plaint on its face, discloses a legal defect regarding maintainability of the suit. The learned Judge does not say that a defect of this nature appears on the face of the plaint. On the contrary he has relied on the serious nature of the objection taken by the defendants to the maintainability of the suit. The proper criterion, however, was to determine firstly whether the plaintiff has made out a prima facie case, and on which side the balance of convenience and inconvenience lies if interim injunction is granted or refused and whether the plaintiff stands to suffer an inrreparable injury if interim injunction is refused."
36. It is admitted and is apparent from the contentions of both the plaintiff and defendants 1, 2 and 3 through their respective counsel that the matter involves a serious question to be tried. The charges are misappropriation, the clandestine and wrongful acts about which I have already mentioned. There are sufficient allegations in the plaint, the applications and the affidavits in support thereof that the first defendant is the prime mover in respect of such wrongful acts by draining out the company's funds and incorporation of the third defendant and securing the agencies of the first plaintiff.
37. ' In this connection the case of Gilford Motor Co. Ltd. v. Harne 1933 Ch. 935 (C A) shows that the Courts will not allow a company to be used as a device to mask the carrying on a business by a former employee of another person and to enable the former employee to break a valid cavenant in restraint of trade contained in the contract under which he was formerly employed. An injunction was granted against the ex-employee and the company. The Gilford case was followed in Jans v.
38. Lipman (1962) 1 W L R '832, where having agreed to sell land to the plaintiff, the defendant sold and transferred the land to a company controlled by him. It was held that the company was the creature of the defendant, a mask to avoid recognition by the eye of equity, and therefore. Specific performance could not be resisted by the defendant. Specific performance was also granted against the company.
39. ' It is stated by the plaintiffs that the defendants 1 and 2 have set up "Messrs Muhammad Bakhsh International Ltd." it is now situated at Insurance House No,1, 5th Floor, Habib Square, M.A. Jinnah Road, Karachi. The first plaintiff is a private Limited Company. It is settled law, that a registered company can be restrained from being registered with a name similar to that of another registered company. There is case-law to indicate, that if a company has already been registered it can be restrained from carrying on business in the registered name. The principles on which an injunction is issued by the Court have been set out in Buckley on the Companies Act, Thirteenth Edition, at page 48:- "The jurisdiction in these cases rests upon fraud or upon property; not that there is property in the name, but that the use of a name closely resembling that in which another carries on business is calculated to deceive or cause confusion between the two businesses and to affect property by diverting customers to the person taking the name, or by affecting the credit or good-will of the person whose name is taken (a) where this is not the case there is not jurisdiction (b)."
40. Now, the first plaintiff is a private limited company of which the one of promoters of the first defendant. In the agreement, dated 2-7-1982 he had agreed and undertook to transfer his 2/7th undivided shares in the immovable property the details thereof were given in paras.
41. 3.04 (ii), (iii), (iv) and (v) of the plaint. He also agreed to clear all the dues and liabilities of the above properties till 11-12-1981. He also agreed by para.16 of the said agreement to clear from his own resources liabilities which were created by him against the plaintiff No,l. He also assured by para. 16 (c) of the said agreement that he had not suppressed any business accounts, profits and affairs from the plaintiff No,2 and that all such business assets, profits and affairs of the plaintiff No,1 were truly reflected in the books/records and accounts of the company prepared and maintained by him.
42. In the above agreement he had not agreed to carry on business under the name Messrs Muhammad Bukhsh International Ltd., yet he had a company incorporated under this name. This would justify the injunction prayed for. Even if this company had been got registered by a stranger, the common law right to get an injunction to restrain the deception to the public resulting from such a registration would exist.
43. The right to claim the injunction is enhanced by the fact that the first defendant wants to carry on exactly the same or similar! Business as the first plaintiff. A similar injunction was granted in the case Manchester Brewery Co. Ltd. v. North Cheshire and Manchester Brewery Co. Ltd. (1898) 1 Ch. D 539, which was affirmed by the House of Lords in the North Cheshire and Manchester Brewery Co.
44. Ltd. v. The Manchester Brewery Co. Ltd, (1899) A C 83. The injunction was granted restraining the defendant company from carrying on business under the style or title of Sturtvant Mill Co.; of U.S.A.
45. Ltd. Or under any similar or colourable syle or title of which the word Sturtvant forms part or under any such other style as to lead to belief that the defendant company is in any way connected with the plaintiffs company Sturtvant Engineering Co. Ltd. v. Sturtvant Mills Co. Of USA, Ltd. (1936) 3 A E R
137. Injunction was also granted to restrain passing off by the defendants by use of the word "EXXON" and to restrain the defendants from allowing any name containing the word "EXXON" to remain on the register as the name of their company. 1981 (2) A E R 495. EXXON Corp. And others v.
46. Exxon Insurance Consultants International Limited.
47. ' There are numerous other cases wherein similar injunctions have been granted. In case, an injunction is granted against a limited company which has already been registered time is given as a matter of course to the defendant No,3 to get its name changed. Otherwise, the injunction is usually in the form of a restrained order against the defendant No,3 not to carry on business under the impugned name Now it is clear to me that the third defendant has been registered with a name which is almost exactly the name as that of the first plaintiff. The difference is so light as to mark no difference. I think, that in the circumstances there is no doubt that the injunction should be granted. I, accordingly grant the injunction to restrain the third defendant from carrying on business under the name of Messrs Muhammad Bakhsh International Ltd.
48. ' A similar order was passed in Kingston Miller & Co. Ltd. v. Thomas Kinston & Co. Ltd. (1912) Ch. D
375. At the conclusion of the order it was stated that the injunction would be suspended for a week to enable the defendants to apply to the Registrar of Joint Stock Companies to change their registered name. I think, that possibly a week will be too short a period for this purpose, in view of the various requirements of the present Companies Ordinance. I accordingly, suspend the injunction restraning the third defendant from trading for a period of one month to enable it to take necessary steps to change its registered name.
49. The ad interim order passed on the 3rd December 1985 will continue. I appoint Mr. Syed Abbas Zia as Receiver and direct him to make inventory and initial the books, papers, account books, ledger books and documents including stationery books and also get complete information from the third defendant as well as their chartered accountants specially all past, current and subsisting business, transactions, contracts and supplies made to the defendants 1, 2 and 3. I direct the directors, Secretary and the chartered accountant to obey and carry out all orders of the Receiver.
50. The seventh defendant is directed not to make any payment to the first and third defendants till the disposal of the suit and to deposit with the Receiver. I also direct the twelfth defendant to disclose all the informations regarding establishing letters of credit through it. The Receiver will be at liberty in case of any doubt difficulty or dispute to apply before this Court with notice to all the parties for appropriate direction and orders whenever he thinks it fit and necessary.
51. ' The remuneration of the Receiver will be paid out of the funds of the company. The applications, disposed of in terms of the above order, I leave the parties to bear their own costs.
52. Finally, I may clarify that the observations made above are tentative in nature for the purpose of disposal of the applications and shall not prejudice any of the parties at the time of final trial of the suit.