The Supreme Court of Pakistan, in a recent judgment issued by majority, has laid down the law in relation to exercise of summary procedure by the Company Judges under Section 9 of the Companies Ordinance, 1984.
The Supreme Court affirmed the earlier precedent that the summary procedure does not bar the Company Judge from receiving oral and documentary evidence. The Supreme Court further held that:
• While peripheral issues can be decided summarily, issues that go to the heart of the claim—particularly, where these relate to authenticity of documents, fraud, and forgery—necessitate framing of issues and full evidentiary examination. These safeguards are needed for fairness and due process.
• A company cannot take notice of trust concerning its shares under Section 148 of the Companies Ordinance, 1984 (and Section 121 of the Companies Act, 2017). Thus, while trust arrangements may be enforceable inter-se the shareholders, the Company Judge cannot take cognizance of such private arrangements.
• Pursuant to Article 76 of the Qanun-e-Shahadat Order, 1984, the Court cannot admit secondary evidence without sufficient cause and compliance with stipulated conditions.
• Whether summary procedure is appropriate or not is contingent upon the complexity of the dispute and the sufficiency of the evidentiary record available before the Court.
Salman Akram Raja, Senior Partner of RMA & Co., successfully represented the Appellants in Civil Appeals 1844 and 1845 of 2019 before the Supreme Court of Pakistan.