MUHAMMAD BUX vs PAKISTAN INDUSTRIAL CREDIT INVESTMENT CORPORATION
This matter concerns the appellate jurisdiction of the Supreme Court under the Companies Ordinance, 1984, following a winding-up order. The respondent initiated winding-up proceedings against a company, which were granted by the High Court, leading to the appointment of an Official Liquidator. Subsequently, the Official Liquidator accepted a bid for the company's assets from respondent No. 4, rejecting the petitioner's offer. The petitioner's High Court Appeal against this order was dismissed on the grounds that, post-winding-up, jurisdiction for appeals lies exclusively with the Supreme Court under Section 10(1) of the Companies Ordinance, 1984. The core legal question is whether the phrase "where the company ordered to be wound up" in Section 10(1) restricts appeals to the Supreme Court solely to the initial winding-up order, or whether it encompasses any subsequent interlocutory orders passed by the High Court during the liquidation process. The Supreme Court granted leave to appeal to resolve this interpretation, noting that a broad reading would make every interlocutory order appealable to the Supreme Court, thereby necessitating a definitive construction of the statutory provision.
- Does the phrase 'where the company ordered to be wound up' in Section 10(1) of the Companies Ordinance 1984 apply only to the initial winding-up order or to all subsequent orders passed by the Court?
- Are interlocutory orders passed by the High Court after a winding-up order has been issued appealable directly to the Supreme Court under Section 10(1) of the Companies Ordinance 1984?
- Section 305, Companies Ordinance 1984
- Section 10(1), Companies Ordinance 1984
- Section 10(2), Companies Ordinance 1984
- Section 10(3), Companies Ordinance 1984
ORDER
1. ' MAMOON KAZI, J.--An application under section 305 of the Companies Ordinance, 1984 was filed by the respondent No,1 against the respondent No,2 alleging that the latter was unable to pay its debts. This application was allowed by the learned Single Judge in the High Court ordering the winding up of respondent No,2 and consequent appointment of Official Assignee as the Official Liquidator with power to take over all the assets of the said respondents.
2. ' The Official Assignee invited bids for the land, machinery and the other assets of the respondent No,2 and offers were made by the petitioner and respondent No,4 respectively, However, the offer of the petitioner was rejected and that of the respondent No,4 in the sum of Rs,375 million, subject to the terms of reference, was accepted. Feeling aggrieved by such order passed by the learned Judge in Chambers, the petitioner filed a High Court Appeal before a Division Bench of the same Court but the same was dismissed as it was held that after the company (respondent No,2) had been ordered to be wound up, any order subsequently passed by the learned Judge in Chambers would become appealable under section 10(1) of the Companies Ordinance to this Court.
3. ' Section 10 of the Companies Ordinance provides as under:-- "Appeals against Court orders. ---(1) Notwithstanding anything contained in any other law, an appeal against any order, decision or judgment of Court under this Ordinance shall lie to the Supreme Court where the company ordered to be wound up has a paid-up share capital of not less than one million rupees; and, where the company ordered to be wound up has a paid-up capital of less than one million rupees, or has no share capital, such appeal shall lie only if the Supreme Court grants leave to appeal.
(2) Save as provided in subsection (1), an appeal from any order made or decision given by the Court shall lie in the same manner in which and subject to the same conditions under which appeals lie from any order or decision of the Court.
(3) An appeal preferred under subsection (2) shall be finally disposed of by the Court hearing the appeal within ninety days of the submission of the appeal."
4. ' The provisions of section 10(1) came up for interpretation before the Lahore High Court in Ch. Jamil Ahmad v. Nippon Bobbin Company (Pakistan) Ltd. (PLD 1991 Lah. 467) and the contention that subsection (1) of section 10 would apply only where a winding up order is to be challenged, was repelled by the Lahore High Court and the word "any" occurring in the said subsection was held to cover all such orders or decisions or judgments which are passed under the Ordinance after a winding up order has been made. In Messrs Industrial Development Bank of Pakistan v. Messrs Kamal Enterprises Ltd. (PLD 1995 Quetta 41), it was held that an appeal under subsection (1) of section 10 would lie to this Court only where the company had been ordered to be wound up and it had a paid-up share capital of not less than one million rupees. The question of jurisdiction in regard to appeals in company matters was considered by this Court in Brother Steel Mills Ltd v.
5. Mian Ilyas Miraj (PLD 1996 SC 543) and it was held that except for cases falling under section 10(1) of the Companies Ordinance, this Court would not have jurisdiction in case where the High Court had passed an order of investigation into the affairs of the company by an Inspector to be appointed by the Corporate Law Authority. It was further held that in such a case the appeal would be maintainable before a Division Bench of the same High Court.
6. The question which, however, arises for determination is whether the words "where the company ordered to be wound up" occurring in subsection (1) of section 10 of the Companies Ordinance nave reference only to the order relating to winding up of the company or they would refer to any order that is passed by the Court after the company has been ordered to be wound up. If such wide connotation is given to the said words, then any interlocutory order passed by the High Court after a company has been ordered to be wound up would become appealable to this Court by virtue of section 10(1). The judgment of the High Court has also been assailed on merits.
7. ' Leave is, therefore, granted to, inter alia, examine the said question.
Cited by 6 cases
- Syed WAJAHAT HUSSAIN ZAIDI vs Messrs T.J. IBRAHIM & CO. through Official 2009 CLD 1225
- KAMALUDDIN QURESHI vs ALI INTERNATIONAL CO. 2009 CLD 784
- KAMALUDDIN QURESHIMessrs ATARA TARPAULIN AND TEXTILE INDUSTRIESFIRST 2009 PLD Supreme Court 367
- Agha FAKHRUDDIN KHAN vs Messrs RUBY RICE AND GENERAL MILLS LIMITED 2001 YLR 1797
- INDUSTRIAL DEVELOPMENT BANK OF PAKISTAN Versus Messrs VALIBHAI KAMARUDDIN 2002 CLD 1485
- Agha FAKHRUDDIN KHAN vs M/s. RUBY RICE AND GENERAL MILLS LTD. and 2001 C.L.R. 1687