High Court wants revision of Company Act
The High Court has given 14 suggestions to the Ministry of Commerce to amend the current company law of the country and enact a new law and to quickly resolve disputes related to the ownership of private and public limited companies.
On Wednesday, Justice Md. settled the case filed under the company law regarding the ownership of Top Ten Fabrics and Tailors Limited. This observation has been given in the judgment of the Single High Court Bench of Ashraful Kamal.
The court observed that the current Companies Act, 1994 is unenforceable in many cases. Although it is called the Companies Act 1994, in fact it remains the Companies Act 1913 in its entirety. In this situation, to take Bangladesh to the level of a developed country, it is absolutely necessary to radically change the 109-year-old company law.
The court said that there is only one company court for several lakhs of private and public limited companies in a country with a population of about 170 crores. Due to the presence of a company bench for numerous company disputes, the day-to-day operations are suffering tremendous losses. If the dispute can be settled quickly, the companies will be able to improve themselves and contribute to the development of the country. It will take a long time to rise to the level of the developed world if our company laws are not molded on the model of the modern and developed world. An advanced and modern company law will develop a developed and prosperous country.
Published on the website of the Supreme Court. In the judgment, the High Court made 14 recommendations to the Ministry of Commerce. The suggestions are:
Bangladesh's company law has been amended and a new law has been drafted on the model of India's company law very quickly. Ministry of Commerce to take necessary steps to update this Act every year.
Take necessary steps to constitute one or more Company Law Tribunals in each district in proportion to the number of companies.
Take necessary steps to constitute one Company Appellate Tribunal in each division.
Take necessary steps to establish Special Criminal Courts for offenses under the Companies Act.
Take appropriate steps to modernize Directorate of Joint Stock Companies and Operations (RJSC) and strengthen legal framework and improve its services.
Suggestion to publish the Corporate Law Code in Bengali and provide necessary instructions for preservation in the office of every company.
Take necessary steps to make it mandatory to have a permanent legal officer by creating the post of a permanent legal officer in every company and to have a lawyer experienced in company law as a consultant.
Establishment of company formation, management and management training centers under the Ministry of Commerce in each district. Making it mandatory for every company's officers to undergo regular training from the training center at least once a year.
Necessary steps to make appointment of one independent director, company secretary, internal auditor mandatory in every company.
Mandatory to have a full time company secretary (who will be a member of ICSB) in every company if the paid up capital is above five crore rupees issue necessary circulars.
Issuance of expedited circulars by making the AGM mandatory in the city where the company's office is registered.
Necessary steps to avoid conflicts with stock market laws, end unwelcome situations in the Annual General Meeting (AGM) of the company, facilitate filing of returns etc.
Formulation of rules completely prohibiting any gift, gratuity, cash payment by the company to the shareholders at the AGM or elsewhere. If the AGM fails, the registration of the concerned company will be automatically cancelled.
Making specific rules regarding filing of profit and loss account, balance sheet, return or tax matter with RJSC.
Commerce Minister, Senior Secretary of Commerce Ministry and Law Commission Chairman have been asked to send a copy of the judgment at the earliest to take necessary action.
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