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PART
XIII
WINDING UP OF UNREGISTERED COMPANIES
443. Meaning
of "unregistered company"-- For the purposes of this Part, the expression
"unregistered company" shall not include a railway company incorporated by Act
of Parliament of the United Kingdom or by a Pakistan law, nor a company registered under
any previous Companies Act or under this Ordinance, but save as aforesaid, shall include
any partnership, association or company consisting of more than seven members.
444. Winding up of unregistered companies.-- (1) Subject to the
provisions of this Part, any unregistered company may be wound up under this Ordinance,
and all the provisions of this Ordinance with respect to winding up shall apply to an
unregistered company, with the following exceptions and additions:
(i) an unregistered company shall, for the purpose of determining the Court having
jurisdiction in the matter of the winding up, be deemed to be registered in the Province
where its principal place of business is situated or, if it has a principal place of
business situate in more than one Province then in each Province where it has a principal
place of business; and the principal place of business situate in the Province in which
proceedings are being instituted shall, for all the purposes of the winding up, be deemed
to be the registered office of the company;
(ii) no unregistered company shall be wound up under this Ordinance voluntarily or subject
to supervision of the Court;
(iii) the circumstances in which an unregistered company may be wound up are as follows
(that is to say):-
(a) if the company is dissolved, or has ceased to carry on business or is carrying on
business only for the purpose of winding up its affairs;
(b) if the company is unable to pay its debts;
(c) if the Court is of opinion that it is just and equitable that the company should be
wound up;
(iv) an unregistered company shall, for the purposes of this Ordinance, be deemed to be
unable to pay its debts---
(a) if a creditor, by assignment or otherwise, to whom the company is in-debted in a sum
exceeding twenty-five thousand rupees then due has served on the company, by leaving at
its principal place of business, or by delivering to the secretary, or some director,
manager or principal officer of the company, or by otherwise serving in such manner as the
Court may approve or direct, a demand under his hand requiring the company to pay the sum
so due, and the company has for thirty days after the service of the demand neglected to
pay the sum, or to secure or compound for it to the satisfaction of the creditor;
(b) if any suit or other legal proceeding has been instituted against any member for any
debt or demand due or claimed to be due, from the company or from him in. his character of
member, and notice in writing of the institution of the suit or other legal proceeding
having been served on the company by leaving the same at its principal place of business
or by delivering it to the secretary, or some director, manager or principal officer of
the company or by otherwise serving the same in such manner as the Court may approve or
direct, the company has not within fifteen days after service of the notice paid, secured
or compounded for the debt or demand, or procured the suit or other legal proceeding to be
stayed, or indemnified the defendant to his reasonable satisfaction against the suit or
other legal proceeding, and against all costs, damages and expenses to be incurred by him
by reason of the same;
(c) if execution or others process issued on a decree or order obtained in any Court or
other competent authority in favour of a creditor against the company, or any member
thereof as such, or any person authorised to be such as nominal defendant on behalf of the
company, is returned unsatisfied in whole or in pan;
(d) if it is otherwise proved to the satisfaction of the Court that the company is unable
to pay its debts; and, in determining whether a company is unable to pay its debts, the
Court shall take into account the contingent and prospective liabilities of the company
and its solvency.
(2) Nothing in this Pan shall affect the operation of any enactment which provides for any
partnership, association or company being wound up, or being wound up as a company or as
an unregistered company, under any previous Companies Act:
Provided that references in any such enactment to any provision contained in any previous
Companies Act shall be read as references 'to the corresponding provision (if any) of this
Ordinance.
(3) Where a company incorporated outside Pakistan which has been carrying on business in
Pakistan ceases to carry on business in Pakistan, it may be wound up as an unregistered
company under this Pan, notwithstanding that it has been dissolved or otherwise ceased to
exist as a company under or by virtue of the laws of the country under which it was
incorporated.
445. Contributories in winding up of unregistered companies.--
(1) In the event of an unregistered company being wound up, every, person shall be deemed
to be a contributory who is liable to pay or contribute to the payment of any debt or
liability of the company or to pay or contribute to the payment of any sum for the
adjustment of the rights of the members among themselves, or to pay or contribute to the
payment of the cost and expenses of winding up the company, and every contributory shall
be liable to contribute to the assets of the company all sums due from him in respect of
any such liability as aforesaid.
(2) In the event of any contributory dying or being adjudged insolvent, the provisions of
his Ordinance with respect to the legal representatives and heirs of deceased
contributories, and to the assignees of insolvent contributories, shall apply.
446. Power to stay or restrain proceedings.-- The provisions of
this Ordinance with respect to staying and restraining suits and legal proceedings against
a company at any time after the presentation of a petition for winding up and before the
making of a winding up order shall, in the case of an unregistered company, where the
application to stay or restrain is by a creditor; extend to suits and legal proceedings
against any contributory of the company.
447. Suits stayed on winding up order.-- Where an order has been
made for winding up an unregistered company, no suit or other legal proceedings shall be
proceeded with or commenced against any contributory of the company in respect of any debt
of the company, except by leave of the Court, and subject to such terms as the Court may
impose.
448. Directions as to property in certain cases.-- If an
unregistered company has no power to sue and be sued in a common name, or if for any
reason it appears expedient, the Court may, by the winding up order, or by any subsequent
order, direct that all or any part of the property, movable or immovable, including all
interests and rights in, to and out or property, movable and immovable, and including
obligations and actionable claims as may belong to the company or to trustees on its
behalf, is to vest in the official liquidator by his official name, and thereupon the
property or any part thereof specified in the order shall vest accordingly; and the
official liquidator may, after giving such indemnity (if any) as the Court may direct,
bring or defend in his official name any suit or other legal proceeding relating to that
property, or necessary to be brought or defended for the purposes of effectually winding
up the company and recovering its properly.
449. Provisions of this part cumulative.-- The provisions of this Part with respect
to unregistered companies shall be in addition to, and not in derogation of, any
provisions hereinbefore, in this Ordinance contained with respect to winding up of
companies by the Court and the Court or official liquidator may exercise any powers or do
any act in the cases of unregistered companies which might be exercised or done by it or
him in winding up companies formed and registered under this Ordinance; but an
unregistered company shall not, except in the event of its being wound up, be deemed to be
a company under this Ordinance, and then only to the extent provided by this Part.
