1987 PLP 413 (MLD)

S.493--Scope and applicability of S.493--Initiation of proceedings and imposition of penalty--Proceedings, held, could be initiated and penalty imposed on delinquent Director, Chief Executive or other official or agent of a company who wrongfully obtains possession of any property of the company or having any such property in his possession wrongfully withholds it wilfully, applies it to purposes other than those expressed or directed in the articles and authorized by Companies Ordinance--No proceedings could be taken against persons under S.493 who were neither officials of the company nor its agents. (b) Companies Ordinance (XLVII of 1984)

S.493--Provisions of S.493 and summary procedure provided thereunder, held, were not meant to be used for deciding disputes requiring detailed enquiry or investigation. Tariq Pervaiz Malik for Petitioner. The General Development and Housing Corporation, a private limited company, has filed this petition through its Chief Executive, seeking initiation of proceedings under section 493 Companies Ordinance, 1984 and for imposing penalties provided thereunder on the respondents. It is further prayed that order be passed directing respondent No.1 to return the assets i.e. the money received, to the petitioner and the respondent be also restrained from interfering in the possession of the petitioner company over the land in question. 2. I have heard the learned counsel for the petitioner quite in detail. The grievance disclosed in the petition is that on 2-10-1986 the petitioner entered into an agreement for purchase of the land measuring 87 kanals and 9 marlas for an agreed sale price of Rs.13,11,750 and paid a sum of Rs.1,50,000 as earnest money to respondent No.1. It is asserted that the entire land agreed to be sold has not been transferred to the company, as only 55 kanals and 10 marlas as against 87 kanals and 9 marlas have been conveyed by executing sale-deeds and. so by not selling the remaining land the petitioner company has been swindled and defrauded to the extent of Rs.2,02,500 by respondent No.1. It is alleged that the fraud has been committed by respondent No.1 in conspiracy and in connivance with respondent No.2 who being the director of the petitioner company was authorized to have the land conveyed in favour of the company. Respondent No.1 is the vendor of the land in question and had allegedly agreed to sell the land to the company vide agreement to sell, dated 2-10-1986. The Station House Officer, Police Station Saddar Berooni, Rawalpindi has been cited as respondent No.3 and th e allegation against him is that he is rending assistance to respondent No.1 in not meeting the lawful demand of the petitioner company to refund the excess amount received by him. 3. The very perusal of the petition shows that the petitioner has chosen wrong forum for seeking redress of its grievance. Section 493 of Companies Ordinance, 1984 makes provision for imposing prescribed penalty on the delinquent director, chief executive or other officer or employee or agent of a company who wrongfully obtains possession of any property of the company or having any such property in his possession wrongfully withholds it or wilfully applies it to purposes other than those expressed or directed in the articles and authorised by this Ordinance. Admittedly, Ghulam Mustafa, respondent No.1 and S. H.O., respondent No.3 are neither officer, employee or agent of the company. Shahid Mahmood, respondent No.2, though has been described as a director of the petitioner company, yet no allegation has been made in the petition so as to attract the previsions of section 493 of Companies Ordinance, 1984. Moreover, the provisions of Company Law and summary procedure provided thereunder are not meant to be used for deciding disputes requiring detailed enquiry or investigation. 4. For the reasons given above, this petition fails and is hereby dismissed in limine. H.B.T./G-36/L Petition dismissed.