CLSP-Aug.

2014 1 of 3 PTO
ICMA
.

Pakistan





CORPORATE LAWS AND
SECRETARIAL PRACTICES (LA-403)
SEMESTER-4
SPRING (AUGUST) 2014 EXAMINATIONS
Wednesday, the 27th August 2014


Time Allowed: 2 Hours 30 Minutes Maximum Marks: 80 Roll No.:




(i) Attempt all questions.
(ii) Answers must be neat, relevant and brief.
(iii) DO NOT write your Name, Reg. No. or Roll No., or any irrelevant information inside the answer script.
(iv) Read the instructions printed inside the top cover of answer script CAREFULLY before attempting the paper.
(v) In marking the question paper, the examiners take into account clarity of exposition, logic of arguments,
effective presentation and language.
(vi) Question Paper must be returned to invigilator before leaving the examination hall.

Marks

Q. 2 (a) (i) What is a prospectus? 01
(ii) When a statement included in a prospectus is deemed to be untrue in terms of the
Companies Ordinance, 1984? 02
(iii) The Companies Ordinance, 1984 requires a sufficient number of copies of the
prospectus shall be made available at certain places. Specify such places. 03



(b) As per section 146 of the Companies Ordinance, 1984 a public company is restricted to
commence business unless it fulfills certain requirements. Describe those requirements. 06



(c) M/s. Big Boss Limited, a public limited company has created a charge in favour of Dell
Bank. Suppose you are a Corporate Consultant of the company and the Company
Secretary is seeking your advice in respect of the following matters:
Required:
(i) The authority with which the mortgage/ charge is to be filed and time period for
filing the mortgage/ charge document. 02
(ii) The documents to be filed for registration of mortgage/ charge. 04






Q. 3 (a) M/s. Solar Petroleum Limited (SPL) is a public listed company. The company is
engaged in the business of exploration and extraction of petroleum. Mr. Saad has been
appointed as a Chief Executive Officer (CEO) of the Company on January 15, 2014.
Since he is not updated with regard to corporate law requirements, therefore consults
Company Secretary on various occasions in respect of the corporate matters. Mr. Saad
overheard a discussion between the Chief Financial Officer (CFO) and Director
Marketing whereby CFO was saying that he had purchased shares of SPL and therefore
needs to fulfill the requirements of beneficial ownership. Mr. Saad called the Company
Secretary and discussed that he also buys and sales shares of SPL. He provided the
following details about his trading in SPLs shares to the Company Secretary for advice:


Sr. # Date
Addition/ (Deletion)
No. of shares
Remarks
1 31.12.2013 45,000 Purchased from the market
2 30.01.2014 150,000 Purchased from the market
3 05.02.2014 *(5,000) Sold in the market at a profit
*These shares were acquired on September 15, 2013.

Required:

Mr. Saad request the Company Secretary to guide him in respect of the following
matters as per the provisions of the Companies Ordinance, 1984:
(i) Mr. Saad asked the Company Secretary to find out whether he is required
to comply with the provisions of beneficial ownership by virtue of trading in the
shares of SPL? 02
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Marks

(ii) Identify the persons other than Chief Executive Officer (CEO) who is required to
comply with the provisions of beneficial owner. 03
(iii) Mr. Saad also asked Company Secretary to identify the legal requirements on
each of the purchase and sale transactions carried out by him as per details given
above. He wants separate comments on each individual transaction. 06



(b) Enumerate the conditions as per the Companies (Issue of Capital) Rules, 1996 for
issuance of bonus shares by a listed company. 08




Q. 4 (a) The Board meeting of M/s. Global Polymer Limited was scheduled on March 15, 2014.
The senior most Director of the company Mr. Kashif, expired two days before the date of
the meeting. The meeting took place on the scheduled date. One of the directors Mr.
Akbar suggested that another gentleman representing minority interest may be
appointed in place of Mr. Kashif and he proposed three names in this regard.
Required:
(i) The Secretary was asked to comment on the proposal of Mr. Akbar in the light of
Code of Corporate Governance and provisions contained in the Companies
Ordinance, 1984 regarding filling of casual vacancy of director. 04

(ii) If a person, representing minority shareholders wants to contest elections of
directors in a listed company, what facilitation the listed company may offer for
proxy solicitation to this person under the Code of Corporate Governance, 2012. 06



(b) In the light of section 95 of the Companies Ordinance, 1984 pertaining to buy-back of
shares, answer the following:
(i) Which type of company can buy its own shares? 01

(ii) The notice of the meeting in which the special resolution authorizing the purchase
of share is proposed to be moved, shall be accompanied by an explanatory
statement containing material facts. Specify such material facts. 04

(iii) List down the particulars to be recorded in the register of shares purchased by a
company through buy-back. 04




Q. 5 (a) Where a modaraba is floated for a fixed period or for a specific purpose, all the directors
of the modaraba company have to file a declaration with the registrar on expiry of the
period fixed or accomplishment of the purpose of the modaraba, as the case may be.
Briefly discuss what is stated in this declaration. 05



(b) What other document required to be accompanied with the declaration at (a) above, and
how much time is available for filing these documents with the registrar? 03




Q. 6 (a) Mr. Asif has recently been appointed as the Chief Executive Officer (CEO) of the M/s.
Shalimar Limited (SL). The first Board meeting of the company subsequent to his
appointment was scheduled on April 25, 2014 to discuss the quarterly accounts for the
3
rd
quarter ended on March 31, 2014. After the meeting was over Mr. Asif noticed that
Company Secretary was very busy in making arrangements for dispatching quarterly
accounts to shareholders.
Required:


Mr. Asif made the following enquiries from the Company Secretary:-
(i) Is there any other way for transmission of accounts to the members instead of
sending them through post? 02

(ii) If the SL wants to transmit quarterly accounts other than by sending them
through post what are the requirements it needs to comply with? 05


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Marks

(b) Alfa Company (Pvt.) Limited is in the process of changing its name to Beta Company
(Pvt.) Limited. The company has to pass the special resolution for change of its name
on the directive of the Registrar.
Required:
For changing the name of the company, draft the resolution to be presented to the
shareholders for approval. 05



(c) Assume the annual general meeting (AGM) of M/s. Mars Chemical Limited is scheduled
on October 29, 2014. The notice for the meeting is issued on October 5, 2013 that
contains a proposal of the directors to appoint the retiring auditors for the current year
too. Company Secretary receives a notice from a shareholder on October 19, 2014 with
proposal for appointing some other audit firm as the auditor.
Required:
Should the notice for appointing an auditor other than retiring auditor received from a
shareholder be accepted or rejected? Discuss in the light of section 253 of the
Companies Ordinance, 1984 Provision as to resolutions relating to appointment and
removal of auditors. 04



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