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 263. Investigation of affairs of company on application
by members or report by registrar:-

„

„ohail (Pvt) Ltd company offers complete technology
products.. It provides infrastructure and business
products
offerings that span from handheld devices to some of the
world's most powerful supercomputer installations.
installations. It
offers consumers a wide range of products and services
from digital photography to digital entertainment and
from computing to home printing.
printing. It has been making
profit for the last five years
years.. However, some shareholders
wants that „
P should take investigations into the
affairs of the company.
company. „hareholders having 7% voting
power have made representations to the „
P.
P.

2
 263. Investigation of affairs of company on application
by members or report by registrar:-

The
ommission may appoint one or more competent persons as

inspectors to investigate the affairs of any company and to report
thereon in such manner as the
ommission may direct:-
(a) in the case of a company having a share capital, on the application
of members holding not less than one-tenth of the total voting power
therein;
(b) in the case of a company not having a share capital, on the
application of not less than one-tenth in number of the persons
entered on the company·s register of members;
(c) in the case of any company, on receipt of a report under sub-
section (5) of section 231 or on a report by the registrar under sub-
section (6) of section 261.

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 264. Application by members to be supported by
evidence and power to call for security:-

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265. Investigation of company·s affairs in other:-

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265. Investigation of company·s affairs in other:-

Without prejudice to its power under section 263, the

ommission:
(b) may appoint one or more competent persons as
inspectors to investigate the affairs of a company and
to report thereon in such manner as the
ommission may
direct if in the opinion of the
ommission there are
circumstances suggesting:

(i) that the business of the company is being or has been

conducted with intent to defraud its creditors,
members or any other persons or for a fraudulent or
unlawful purpose, or in a manner oppressive of any of its
members or that the company was formed for any
fraudulent or unlawful purpose; or
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265. Investigation of company·s affairs in other:-

Without prejudice to its power under section 263, the

ommission:
(b) may appoint one or more competent persons as
inspectors to investigate the affairs of a company and
to report thereon in such manner as the
ommission may
direct if in the opinion of the
ommission there are
circumstances suggesting:

(ii) that persons concerned in the formation of the

company or the management of its affairs have in
connection therewith been guilty of fraud, misfeasance,
breach of trust or other misconduct towards the
company or towards any of its members or have been
carrying on unauthorized business; or
-
265. Investigation of company·s affairs in other:-

Without prejudice to its power under section 263, the

ommission:
(b) may appoint one or more competent persons as
inspectors to investigate the affairs of a company and
to report thereon in such manner as the
ommission may
direct if in the opinion of the
ommission there are
circumstances suggesting:

(iii) that the affairs of the company have been so

conducted or managed as to deprive the members
thereof of a reasonable return; or

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265. Investigation of company·s affairs in other:-

Without prejudice to its power under section 263, the

ommission:
(b) may appoint one or more competent persons as
inspectors to investigate the affairs of a company and
to report thereon in such manner as the
ommission may
direct if in the opinion of the
ommission there are
circumstances suggesting:

(iv) that the members of the company have not been

given all the information with respect to its affairs
which they might reasonably expect; or

(v) that any shares of the company have been allotted

for inadequate consideration; or
]
265. Investigation of company·s affairs in other:-

Without prejudice to its power under section 263, the

ommission:
(b) may appoint one or more competent persons as
inspectors to investigate the affairs of a company and
to report thereon in such manner as the
ommission may
direct if in the opinion of the
ommission there are
circumstances suggesting:

(vi) that the affairs of the company are not being

managed in accordance with sound business principles or
prudent commercial practices; or

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265. Investigation of company·s affairs in other:-

Without prejudice to its power under section 263, the

ommission:
(b) may appoint one or more competent persons as
inspectors to investigate the affairs of a company and
to report thereon in such manner as the
ommission may
direct if in the opinion of the
ommission there are
circumstances suggesting:

(vii) that the financial position of the company is such as

to endanger its solvency:

Provided that, before making an order under clause (b),

the
ommission shall give the company an opportunity to
show cause against the action proposed to be taken.
||
 266. Inspector to be a
ourt for certain purposes:-

(1) A person appointed as inspector under section 263 or

section 265 shall, for the purposes of his investigation,
have the same powers as are vested in a court under the

ode of
ivil Procedure, 1908 (Act V of 1908), while trying
a suit, in respect of the following matters, namely,-

(a) enforcing the attendance of persons and examining

them on oath or affirmation;

(b) compelling the discovery and production of books and

papers and any material objects; and

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 266. Inspector to be a
ourt for certain purposes:-

(1) A person appointed as inspector under section 263 or

section 265 shall, for the purposes of his investigation,
have the same powers as are vested in a court under the

ode of
ivil Procedure, 1908 (Act V of 1908), while trying
a suit, in respect of the following matters, namely,-

(c) issuing commissions for the examination of witnesses;

and every proceeding before such person shall be deemed

to be ´judicial proceedingµ within the meaning of sections
193 and 228 of the Pakistan Penal
ode, 1860 (Act XLV of
1860).

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 266. Inspector to be a
ourt for certain purposes:-

(2) Any contravention of or non-compliance with any

orders, directions or requirement of the inspector
exercising powers of a court under sub-section (1) shall, in
all respects, entail the same liabilities, consequences and
penalties as are provided for such contravention, non-
compliance or default under the
ode of
ivil Procedure,
1908 (Act V of 1908), and Pakistan Penal
ode, 1860 (Act
XLV of 1860).

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 267. Power of inspectors to carry investigation into
affairs of associated companies.-

(1) If an inspector appointed under section 263 or section 265 to

investigate the affairs of a company thinks it necessary for the purposes
of his investigation to investigate also the affairs of:-
(a) any other body corporate which is, or has at any relevant time been,
the company·s associated company or its subsidiary or holding company, or
a subsidiary of its holding company, or a holding company of its
subsidiary;
(b) any other body corporate which is, or has at any relevant time been,
managed as chief executive by any person who is or was at the relevant
time the chief executive of the company ;
(c) any person who is or has at any relevant time been the company·s chief
executive or managing agent or an associate of such chief executive or
managing agent;
the inspector shall, subject to the provisions of sub-section (2) have
power so to investigate and shall report on the affairs of the other body
corporate or of the chief executive or the managing agent or an associate
of the chief executive or managing agent, as the case may be, so far as he
thinks that the results of his investigation thereof are relevant to the
investigation of the affairs of the company. |
 267. Power of inspectors to carry investigation into
affairs of associated companies.-

(2) In the case of any body corporate or the chief

executive referred to in clause (b) or clause (c) of sub-
section (1), the inspector shall not exercise his power of
investigation into, and reporting on, its or his affairs
without first having obtained the approval of the

ommission, by a properly verified application in which he
shall state the facts in detail and the grounds on which he
applies for such approval.

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 268. Duty of officers, etc., to assist the inspector.-

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 269. Inspector·s report:-

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 269. Inspector·s report:-

(1) The inspectors may, and if so directed by the

ommission shall, make interim reports to the
ommission,
and on the conclusion of the investigation, shall make a
final report to the
ommission; and any such report shall
be typed or printed as the
ommission may direct.
(2) The
ommission:
(b) may, if it thinks fit, furnish a copy thereof, on request
and on payment of the prescribed fee, to any person
(i) who is a member of the company or other body
corporate or is interested in the affairs of the company;
(ii) whose interests as a creditor of the company or other
body corporate appear to the
ommission to be affected;;
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 269. Inspector·s report:-

(1) The inspectors may, and if so directed by the

ommission shall, make interim reports to the
ommission,
and on the conclusion of the investigation, shall make a
final report to the
ommission; and any such report shall
be typed or printed as the
ommission may direct.
(2) The
ommission:
(c) shall, when the inspectors are appointed under clause
(a) or clause (b) of section 263, furnish, at the request of
the applicants for the investigation, a copy of the report
to them;

(d) shall, where the inspectors are appointed under

section 265 in pursuance of an order of the
ourt, furnish
a copy of the report to the
ourt; 2
 269. Inspector·s report:-

(1) The inspectors may, and if so directed by the

ommission shall, make interim reports to the
ommission,
and on the conclusion of the investigation, shall make a
final report to the
ommission; and any such report shall
be typed or printed as the
ommission may direct.
(2) The
ommission:
(e) may forward a copy of the report to the registrar with
such directions as it may deem fit; and

(f) may also itself cause the report or any part thereof to
be published or direct the company to do so or send the
same to its shareholders.

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