The two petitioners Abdur Rauf and his wife Mst. Shahida Jabeen claim to be the shareholders and Directors (hereinafter to be called as the petitioners) in the Company known as Maftahuddin Flour Mills (Pvt.) Limited and according to the memorandum of association the registered office will be situated in N.-W.F.P. And one of its object to acquire and take over as a going concern in whole or in part the business, goodwill assets, rights, titles, interest, commitments, benefits of all subsisting contracts and undertakings of "Malakand Flour Mills". The petitioner has instituted this application under sections 290 and 291 of the Companies Ordinance with a prayer that the management, control and affairs of Malakand Flour Mills which have been taken over forcibly by respondent No,2 be handed over to the petitioner being majority shareholders. A prayer for the appointment of a provisional Manager was also made. The notices were issued to the respondents who attended the Court and filed their written statements through their learned counsel. In the reply of respondents 2 to 5 some preliminary objections were taken (1) with regard to the maintainability of the petition for the lack of territorial jurisdiction of this Court by stating that the registered office of the Company is situated at Thana Malakand Agency (PATA), where the jurisdiction of this Court has not been extended. (ii) That Malakand Flour Mills over which the petitioners have agitated certain dispute in the instant petition is not the property of respondent No,1 Company and rather it belonged to other respondents, who inherited it from their fathers, excluding the petitioners who have been compensated either in the form of more share in other property or through compensation during partition, and which is now their own private property and on this ground, too, the jurisdiction of the Court was questioned.
2. The learned counsel for the petitioner has contended that the Companies Ordinance, 1984 was promulgated and enforced by the President as per its preamble in the pursuance of the proclamation of the 5th day of July, 1977 and in the exercise of powers enabling him in that behalf and with reference to Article 270-A of the Constitution of Islamic Republic of Pakistan, 1973, all the Ordinances and Orders issued and promulgated by the President in-between 5th day of July, 1977 and 30-12-1985 have been saved and they will remain enforced notwithstanding anything in the Constitution and thus the Companies Ordinance, 1984 would not lapse even after the period of four months as it would not be hit by Article 89 of the Constitution. He has also argued that by incorporating the word notwithstanding anything in Article 270-A of the Constitution, the Ordinance need not be extended through Article 247 of the Constitution, rather in view of the fact that an Ordinance being promulgated by the President in pursuance of the proclamation of the 5th day of July, 1977, this Ordinance will be deemed to have been extended to the tribal territory. In this respect reliance was placed on 1993 SCM R 1523, PLD 1990 Federal Shariat Court 26, PLD 1986 Pesh.
166 and 1998 M LD 1351.
3. With regard to the other objection of the learned counsel for the respondents i,e, the Malakand Flour Mills is not the property of the Company but it is the property of respondent No,2, he referred to various documents placed on file demonstrating that Malakand Flour Mills is the property of the Company and in which respect all those relevant documents, alongwith other Directors/shareholders, were also signed by respondent No,2 as one of the shareholders. The first one in the line is memorandum and the article of association which has been signed by respondent No,2 Jamaluddin Miftah, then a Resolution No,1, a list of past and present Members and debenture holders showing shares of respondent No,2, Part 'C' allotment of bonus shares.
5. The learned counsel for respondents Nos.6 to 9 has also supported the petition and has contested the objections raised by the other respondents. He has submitted that according to section 16(A)(ii) of the Ordinance that in case of a Company Ltd, by shares, the memorandum shall state the Province or the part of the Province not forming part of a Province, as the case may be, in which the Registrar Office, Office of the Company is to be situated. A reference was made to the memorandum and article of association and according to Clause II the registered Office of the Company will be situated in the N.-W.F.P. According to him the Registered Office, per its memorandum and Article of association, situated in the N.-W.F.P. And no change has been made to the place of the office of the Company as per section 21 of the Companies Ordinance. Similarly no compliance has been made of section 24 of the Ordinance and by non-compliance of sections 21 and 24, which is also not the case of respondent No,2 that the place of office of the Company has been changed, then it would be ineffective for noncompliance of section 25 after the lapse of 90 days. According to section 466 of the Ordinance that no Company shall be registered except at the office within the Province or territory in which by memorandum, the registered office of the Company is declared to be established and as the registered office of respondent No,1 Company has been registered with the Registrar of Companies at Peshawar, North-West Frontier Province, hence it cannot be now objected to by any of the shareholders that the office of the Company is outside the jurisdiction of the office of the Registrar of Companies situated in the N.-W.F.P. With regard to the objection of the learned counsel for the petitioner on legal premises and in which respect reliance has also been placed on PLD 1990 FSC 26 approved in 1993 SCM R 1523 and PLD 1986 Pesh. 166, it may be stated that the said authorities are distinguishable and not applicable to the instant case. In the said judgments the question was to the extension of the prohibition order while in the instant case the question does not relate to the extension of an order passed by the President/Chief Martial Law Administrator but rather it is an Ordinance which has been promulgated by the President. The two enactments are quite different and with different efficacy.
According to Article 89 of the Constitution of Islamic Republic of Pakistan, 1973 the Ordinance may be treated as an Act of the Parliament while there are no such provisions to treat as order as similar to the Act of Parliament and this was the reason that in relation to the extension of the Prohibition Order, no such Notification has been issued by the President with regard to its extension to the Tribal Area as required under Article 247 of the Constitution as held in PLD 1986 Pesh. 66, 1990 FSC 26 and 1993 SCM R 1523 that Order needs no separate notification for its extension to C Tribal Area, but in cases of the Ordinance e.g the offences i,e, the Offences Against Property (Enforcement of Hudood) Ordinance, 1979, the Offence of Zina (Enforcement of Hudood) Ordinance, 1979 and the Offence of Qazf (Enforcement of Hadd) Ordinance, 1979, as referred to in the judgment, PLD 1982 FSC 168, formal notification by the President is required for its extension to the Tribal Area. These were promulgated on one and the same date but no separate Notification was issued by the President with regard to the application of Prohibition (Enforcement of Hadd) Order, 1979 in the Tribal Area. Hence only on the ground that the Ordinance has been promulgated by the President in pursuance of proclamation on 5th July, 1977 by itself does not extend to the Tribal Area unless so extended under Article 247 of the Constitution while the order needs no such separate Notification for extension to the Tribal Area. Hence his this contention is repelled. Similarly his other submission that as per Article 270-A of the Constitution, the Ordinance promulgated during the period mentioned in the said Article i,e, 5th July, 1977 to 30th December, 1985 would be exempt from the application of Article 89 of the Constitution and by which force they could be considered is not an Act of the Parliament whereby the Ordinance has also been treated an Act and when it is taken out of the purview of Article 89, then the Ordinance needs no sanction for its extension for the Tribal Area, is also not tenable. The said Article i,e, Article 270-A only saved the existence and application of laws, but that would not give them a status like that of order, which by its very nature would be applicable to the Tribal Area.
6. After holding that the Companies Ordinance, 1984 which requires its extension by virtue of Article 247 of the Constitution and has not been extended, is not applicable in the PATA. Now the other question which poses itself for consideration is with regard to the jurisdiction of this Court in the PATA and if it has got the jurisdiction, then under what law the proceedings will be conducted by this Court. The Court has been defined by section 2(11) of the Companies Ordinance, 1984, the Court means the Court having jurisdiction under this Ordinance and according to section 7(1), the Court having jurisdiction under this Ordinance, shall be the High Court having jurisdiction in the place at which registered office of the Company is situated. According to section 8 of the Ordinance there shall in each High Court be one or more benches, each to be known as the company bench to be constituted by the Chief Justice of the High Court to exercise the jurisdiction vested in the High Court under section 7. The Hon'ble Chief Justice while exercising powers under section 8 of the Ordinance has issued a Notification on 30-6-1997 with regard to the constitution of company bench comprising of the undersigned for disposal of matters of N.-W.F.P. Except Abbottabad and D.I. Khan coming under the said Ordinance. According to Article 1 of the Constitution of Islamic Republic of Pakistan, 1973, the Province of N.-W.F.P. Is part of Pakistan and according to Article 4(2) of the President Order 1 of 1970 read with Schedule thereto the territories of N.-W.F.P. Includes Malakand Division and former States of Dir, Swat and Chitral and the Malakand protected area and which Article of the Order came into force on the 1st July of 1970 through a gazetted notification, dated 16-6-1970. His now quite clear that this Court, the company Judge, is having the jurisdiction in the place where the jurisdiction of the Peshawar High Court, Peshawar has been extended.
According to Article 247(7) of the Constitution of Islamic Republic of Pakistan, 1973, neither the Supreme Court nor the High Court shall exercise any jurisdiction under the Constitution in relation to Tribal Area unless Parliament by law otherwise provides. The jurisdiction of the Peshawar High Court and of the Supreme Court has been extended by Act No,XXVII of 1973 of the Parliament which is reproduced:-- "2. Extension of jurisdiction of Supreme Court.--The Supreme Court of Pakistan shall have, in relation to the Provincially Administered Tribal Areas of Chitral, Dir, Kalat, Swat and Malakand Protected Areas, the same jurisdiction as it has in relation to the other areas of the North-West Frontier Province.
3. Extension of Jurisdiction of High Court.--The Peshawar High Court shall have; in relation to the Tribal Areas specified in section 2, the same jurisdiction as it has in relation to the other areas of the North-West Frontier Province." Now it is quite evident that the jurisdiction of the Peshawar High Court, Pesahwar has been extended to PATA including Swat. However, here in this case this fact is not of mulch importance due to location of Company's registered office as mentioned in the memorandum of, association is, N.-W.F.P. And the dispute is also not related to Company.
7. With regard to the other question i,e, what law would be applicable. According to section 508 of the Companies Ordinance, 1984 read with Schedule 7, the Company Act, 1913 has been repealed, but as the Companies Ordinance, 1984, as we held is not applicable/extended to the PATA area, then the repealing provisions would also be not applicable and hence the Company Act, 1913 which had been extended to the Tribal Area vide the Tribal Area (Application of Acts) Regulation, 1965 remains in the field and will operate. In this respect reliance can be placed on 1996 SCM R 886 (Tilla Gul v. Deputy Collector of Central Excise and Land Customs, Peshawar and 2 others), whereby alike question has arisen with regard to the effect of repeal of Sea Customs Act, 1878 in the Tribal Area and the application of the Customs Act, 1969, under the analogous provisions of Constitution of Pakistan, 1962, it was observed:- "It is worthy to note that clause (2) of Article 223 of the Constitution of Pakistan, 1962 gave unbridled powers to the President of Pakistan to legislate for the Tribal Areas. Through Regulations with respect to any matter within legislative competence of the Central Legislature. This power could be exercised by the President notwithstanding fact that there was no Act passed by .The Parliament of Pakistan on the subject covered by the President's Regulation for the Tribal Areas. Hence one can visualize a law existing in the Tribal Areas but not in the settled areas of Pakistan. While the provisions contained in Sea Customs Act were made applicable to the Tribal Areas by virtue of Article 223(1) of the Constitution of Pakistan, 1962, it was not an Act of legislation by the President and such legislation was independent of applicability of the said Act in settled areas of Pakistan.
Conversely disappearance of such legislation from settled areas of Pakistan, would not affect duly legislated law applicable to Tribal Areas. President had general powers of legislation for the Tribal Areas with respect to any matter within legislative competence of the Central Legislature vide Article 223(2) of the Constitution of Pakistan, 1962. Hence repeal of Sea Customs Act in the Tribal Areas cannot be assumed, due to its repeal in Pakistan by an Act not yet made applicable under Article 247 (3) of the Constitution of Pakistan, 1973 to the Tribal Areas. As mentioned under Chapter XIV of the Construction of Statutes by Earl T. Crawford the power to repeal is a legislative function or attribute. Consequently the contentions raised on behalf of the petitioners have no force."
8. Section 508 (proviso to subsection (1)) have saved the incorporation of any company registered under any law which was repealed by the Ordinance and similarly any offence has been committed under the old law, the proceedings may be taken under this Ordinance and similarly under subsection (2) of section 6 of the General Clauses Act, 1897 has been made applicable and similarly under section 510 of the Ordinance all the actions, investigations, proceedings, orders initiated under the repealed laws have been saved, in other words this Court has the jurisdiction to adjudicate upon the proceedings under the Company Act, 1913 as held in 1986 CLC 2933(c), then proceedings can be initiated under the Company Act, 1913 in this Court if otherwise it has got jurisdiction under Companies Ordinance, 1984 and, thus, the proceedings can be initiated and shall continue before this Court initiated or taken under the repealed laws i,e, Company Act, 1913 as this Court having the jurisdiction to deal with the matters under the repealed laws.
9. The jurisdictional points of this Court can further be strengthened when through Regulation, 1986 the registration authority at Peshawar was given power to have a jurisdiction with regard to the registration of a registered office of a Company at PATA, the relevant portion of which is reproduced below:-- ........In exercise of the powers conferred by subsection (2) of section 486 of the Companies Ordinance, 1984 (XLVIII of 1984) read with the Finance Division Notification No,S.R.O.698(1)/86, dated the 2nd July, 1986, the Corporate Authority hereby makes the following regulations, namely:-- ................................................................................................................................................................... .....................................................
3.--(1) For registration of companies and performing other duties under the Ordinance, the organisation for registration of companies shall, besides the office of the Registrar of Companies, Pakistan, have Company registration offices in the following towns with jurisdiction extending to companies, not being companies to which section 5 applies, having registered offices in the territories mentioned against each... ...Peshawar. The Province of the North-West Frontier, the Federally Administered Tribal Areas and the Provincially Administered Tribal Areas to which the Executive Authority of the Province of the North-West Frontier extends."
10. While holding that this Court has got the jurisdiction over PATA I also hold that this Court has got no jurisdiction in the matter as the petitioner essentially wants to proceed with the case under sections 290 and 291 for the mismanagement of Malakand Flour Mills, a Unit, a concern and which is not the property/assets if the Company, the M/s. Miftahuddin Flour Mills and as both these are different entities one is a Company while the other is Flour Mills though the name apparently seems to be synonymous but not in fact. This Company has been incorporated for running of Malakand Flour Mills to be acquired, but that object was not achieved and finalized and the unit has not become the property/assets of the Company so registered and the dispute purely relates to the Flour Mills and not to the Company and it is a dispute regarding the share or management or mismanagement of Flour Mill, the unit, which has got no concern whatsoever with the Company.
This Court can assume the jurisdiction only when there is a dispute relating to the Company and not the unit, which is not the property of the Company.
11. Resultantly this petition is dismissed. However, the petitioner can seek his relief from the competent Court.