๐ ๐๐จ๐ฆ๐ฉ๐๐ง๐ฒ ๐ก๐๐ฏ๐ข๐ง๐ ๐๐๐๐ง ๐๐ซ๐๐๐ซ๐๐ ๐ญ๐จ ๐๐ ๐๐จ๐ฎ๐ง๐ ๐๐ฉ ๐๐๐ฒ ๐๐ญ๐ข๐ฅ๐ฅ ๐๐ก๐๐ฅ๐ฅ๐๐ง๐ ๐ ๐ญ๐ก๐ ๐๐๐ฆ๐ ๐ข๐ง ๐๐ฉ๐ฉ๐๐๐ฅ: ๐๐
Honorable Justice Syed Mansoor Ali Shah settled a new and significant question in company law related matters.
๐๐จ๐ง๐ญ๐๐ฑ๐ญ
When a company is ordered to be wound up and liquidator has been appointed, the company becomes dysfunctional and its directors functus officio, meaning thereby that they have no power to do any thing on behalf of the company.ย It is the liquidator who are transferred all the powers previously available to the directors. The question here arises that what if the company/directors feel aggrieved by the winding-up order? Who can file, in such a scenario, theย Petition for Leave to Appeal before the Supreme Court ? Does this power still available to the company through its directors despite being dysfunctional and having become functus officio.?ย
๐๐ซ๐๐๐ซ ๐จ๐ ๐ญ๐ก๐ ๐๐จ๐ฎ๐ซ๐ญ
The Supreme Court in its recent judgment answers this question in affirmative, holding that appeal is the continuation of the original proceeding. When the directors can contest the winding-up proceeding, which is the original proceeding, so can they contest and file the appeal as well.
๐๐๐๐ฌ๐จ๐ง๐ข๐ง๐
Further, requiring from or conferring upon the liquidator the power to file an appeal on behalf of the company against the winding-up order would amount to giving saw in the hand of the liquidator to cut off the tree’s branch he is sitting on. How a liquidator can be asked or required to challenge and appeal against what he was previously asked to do? It is also against common logic.
Another question the Court has attempted to discuss is that when an appeal is available to any person and it has not been specified whom the appeal is available to, this implies that the right to appeal is available to every person who is aggrieved by the original order. The Company Act, 2017, does not specify a person who has the right to appeal from the winding-up order. Instead it says that “any person aggrieved by ……..”. The Court held that this right is available to any person who is aggrieved by or adversely affected by the winding-up order, including the company which can be rightly assumed to be an aggrieved person.
The Court at the end has briefly alluded to the right of due process and fair trial as well, saying that right to fair trial and due process is avail to every person including a juristic person. However, this is mentioned that the definition of ‘Person’ in the Constitution includes a ‘body politic and corporate’.
c.p._1422_l_2021_28062024