THE COMPANIES ORDINANCE, 1972

Registers of directors' holdings, of substantial shareholders' holdings and of options to subscribe

111.—(1) Every company shall keep a register (in this Ordinance called "the register of directors' holdings") in which it shall enter the particulars required by this section in respect of all interests in shares and debentures of the company, of companies belonging to the same group of companies as the company, and of associated companies of the company, which are vested in any of the directors of the company, or of companies belonging to the same group of companies as the company.

(2)  For the purposes of this section a director has an interest in shares or debentures if : —

{a) the shares or debentures are registered in the directors' name, or the names of the director and other persons jointly, or in the name of a nominee for him, or for him and them ; or

(b} the director has a derivative interest in the shares or debentures, or a right or power to acquire a derivative interest in them ; or

(c)   the director has a right to subscribe for the shares or debentures, or another person has a right to subscribe for them and the director has a right to acquire them after they have been allotted ; or

(d)   the shares or debentures are the subject of a voting arrangement in favour of a director, that is to say, an arrangement (whether legally enforceable or not) by which the director may require the holder of the shares or debentures to vote, or not to vote, or to vote in a particular manner, at any general meeting of the company or at any meeting of a class of shareholders or debenture holders, or by which the director may require the holder of the shares or debentures to appoint the director or any other person to be his proxy with power to vote in respect of the shares or debentures at any such meeting.

(3)  For the purposes of this Ordinance a company is the associated company of another company if : —

(a)   the company holds, by itself or its nominees, shares in that other company which entitle the holder of such shares to exercise at least one-fifth of the unrestricted voting rights exercisable at any general meeting of that other company, or if that other company holds, by itself or its nominees, shares in the company which entitle their holder to exercise the same fraction of voting rights at any of its general meetings; or

(b)   the other company is the holding company or subsidiary of a third company which is an associated company of the company by virtue of paragraph (a) of this subsection.

(4)  The particulars required to be entered in the register of directors' holdings are : —

(a) the number, classes and nominal values of the shares, and the number, classes and the amount of the principal and premiums payable to the holder of the debentures, in which a director has an interest;

(b) the nature of the interest of the director and its duration (if it is limited in duration);

(c)   the date of the acquisition of the interest by the director and the consideration {if any) given by him or any other person for such acquisition ; and

(d)   the date of the disposal of the interest by the director or the date of its cessation (whichever first occurs) and the consideration (if any) received by him or any other person for such disposal or cessation.

(5)  It shall be the duty of every director in respect of whom any entry is required to be made in the register of directors' holdings to notify the company in writing within seven days after the matter occasioning the entry occurs or arises, or if it has occurred or arisen before this section comes into operation, within seven days after that time, and to include in the notification the particulars which the company is required to enter in the register in respect of that matter.

(6)  This section shall exend to interests in shares and debentures vested in a director at the time when he becomes a director, and subsection (5) shall apply in that case with the substitution of a period of seven days after the director becomes a director for the period of seven days after the matter occasioning an entry occurs or arises.

(7)  The entries which are required to be made in the register of directors' holdings by this section shall not be removed from the register, notwithstanding the fact that the person in respect of whom they are required to be made ceases to be a director, but it shall not be necessary to make an entry in the register in respect of a matter which occurs or arises after he ceases to be a director.

(8)  Subsections (2) and (3) of section 102 of this Ordinance and section 105 shall apply to the register of directors' holdings as they apply to the register of members.

(9)  This section shall not apply to an interest of a director which is created by the memorandum or articles of the company if the interest is one which is conferred on all shareholders of the company or on all shareholders of the class concerned, on the same terms and conditions as on the director, that is to say, strictly in proportion to the shares, or shares of that class, held by them respectively.

(10)  A company and every director of a company who if in default shall be guilty of an offence : —

(a)   if the company fails to make an entry required by this section in its register of directors' holdings within three days after written notification of the matter required to be registered is given to it under subsection (5) or (6), or within seven days sfter it or any of its directors (other than a person in respect of whom an entry is required to be made) acquires knowledge of the matter in relation to which an entry is required to be made (whichever is the earlier); or

(b)   if the company makes a false, misleading or incomplete entry in relation to a matter which is required to be entered in its register of directors' holdings.

(11)  A director of any company shall be guilty of an offence if he fails to give a written notice of any matter in compliance with subsection (5) or (6) within the time thereby limited to every company which is required to make an entry in relation to the matter in its register of directors' holdings, or if he gives false, misleading or incomplete informaton to any such company wth a view to it making an entry in its register of directors' holdings.

(12)  An offence under subsection (10) or (11) shall be punishable by a fine not exceeding ten thousand rupees.

(13)  If a company keeps its register of directors' holdings elsewhere than at its registered office, and fails to send a notice to the Registrar of the place where the register ir, kept, or of any change in that place, within fourteen days after the register is first so kept or the change takes place (as the case may be), the company and every officer of the company who is in default shall be liable to a default fine.

(14)  This section shall not apply to a proprietary company.

(15) This section shall not come into operation until a date appointed by the Governor in Council by notice in the Gazette.

112.—(1) Every company shall keep a register (in this Ordinance called "the register of substantial shareholders' holdings") in which it shall enter the same particulars in respect of the interests in shares and debentures which are vested in any person who is a substantial shareholder of the company as are required by section 111 to be entered in the register of directors, holdings in respect of the interests of a director of the company.

(2) It shall be the duty of every person in respect of whom an entry is required to be made in the register of substantial shareholders' holdings to notify the company in writing within seven days after the matter occasioning the entry occurs or arises, or if it has occurred or arisen before this section comes into operation, within seven days after that time, and to include in the notification the particulars which the company is required to enter in the register.

(3)  This section shall extend to interests in shares and debentures vested in a substantial shareholder at the time when he becomes a substantial shareholder, and subsection (2) shall apply in that case with the substitution of a period of seven days after the substantial shareholder becomes a substantial shareholder for the period of seven days after the matter occasioning an entry occurs or arises.

(4)  The entries which are required to be made in the register of substantial shareholders' holdings by this section shall not be removed from the register, notwithstanding the fact that the person in respect of whom they are required to be made ceases to be a substantial shareholder, but it shall not be necessary to make an entry in the register in respect of a matter which occurs or arises after, he ceases to be a substantial shareholder.

(5)  Subsection (2) and (3) of section 102 of this Ordinance and section 105 shall apply to the register of substantial shareholders' holdings as they apply to the register of members.

(6)  For the purposes of this Ordinance a person is a substantial shareholder of a company if he holds, by himself or by his nominees, shares which entitle their holder to exercise at least ten per cent of the unrestricted voting rights exercisable at any general meeting of the company.

(7)  This section shall not apply to an interest of a substantial shareholder which is created by the memorandum or articles of the company if the interest is one which is Conferred on all shareholders of the company or on all shareholders of the class concerned, on the same terms and conditions as on the substantial shareholder, that is to say, strictly in proportion to the shares, or Shares of that class, held by them respectively.

(8)  A company and every director of a company who is in default shall be guilty of an offence if : —

(a)   the company fails to make an entry required by this section in its register of substantial shareholders' holdings within three days after written notification of the matter required to be registered is given to it wider subsection (2) or (3), or within seven days after it or any of its directors acquire knowledge of the matter in relation to which an entry is required to be made ; or

(b)   the company makes a false, misleading or incomplete entry in relation to a matter whidh is required to be entered in its register of substantial shareholders' holdings.

(9)  A substantial shareholder of any company shall be guilty of an offence if he fails to give to the company of which he is a substantial shareholder written notice of any matter in compliance with subsection (2) or (3) within the time thereby limited, or if he gives false, misleading or incomplete information to any such company with a view to it making an entry in its register of substantial shareholders' holdings.

(10)  An offence under subsection (8) or (9) of this section shall be punishable by a fine 'not exceeding ten thousand rupees.

(11) If a company keeps its register of substantial shareholders' holdings elsewhere than at its registered office, and fails to send a notice to the Registrar of the place where the register is kept, or of any change in that place, within fourteen days after the register is first so kepft or the change takes place (as the case may be), the contpany and every officer of the company who is in default shall be liable to a default fine.

(12)  This section shall not apply to a proprietary company.

(13)   This section shall not come into operation until a date appointed by the Governor in Council by notice in the Gazette.

113.—(1) A proprietary company shall keep a register (in this Ordinance called "the register of subscription options") in which it shall enter the particulars which, if it were not a proprietary company, would be required to be entered in its register of directors' holdings and its register of substantial shareholders' holdings under paragraph (c) of section 111 as applied by that section and section 112.

(2)  Subsection (2) and (3) inclusive of section 102, subsections (5) to (7) and (9) to (13) inclusive of section 112 and subsections (2) to (4) and (6) to (11) inclusive of section 112 shall apply to the register of subscription options of a proprietary company as they apply respectively to the register of members, the register of directors' holdings and the register of substantial shareholders' holdings of any other company.

(3)   The register of subscription options shall during business hours (subject to such reasonable restrictions as the company in general meeting may impose, so that not less than two hours each day be allowed for inspection) be open to the inspection of every member and debenture holder of the company without charge.

(4)  Any member or debenture holder of the company may require the company to supply him with a copy of the register, or of any part thereof, on payment of one rupee, or such less sum as the company may specify, for every hundred words or fractional part thereof required to be copied. The company shall cause any copy so required by any member or debenture holder to be sent to that member or debenture holder within a period of ten days commencing on the day next after the day on which the requirement is received by the company.

(5)  If any inspection required under this section is refused or any copy required under this section is not sent within the proper period, the company and every officer of the company who is in default shall be liable in respect of each offence to a fine not exceeding one hundred rupees and further to a default fine of one hundred rupees.

(6)  In the case of any such refusal or default, the court may by order compel an immedite inspection of the register or direct that the copies required shall be sent to the members or debenture holders requiring them.

(7)  This section shall not come into operation until a date appointed by the Governor in Council by notice in the Gazette, and different dates may be appointed in respect o/ that part of the register which, if a company were not a proprietary company, would be required to be contained in its register of directors' holdings, and in respect of the remainder of the register of subscription options.