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Termination of Membership of a Shareholder
03-17-2009, 07:45 PM
Post: #1
Termination of Membership of a Shareholder
What are the Circumstances under which the membrship of a shareholder can be terminated.

Please give reply to the quote with reference to the relevant sections of CO 1984 or other law applicable on companies.

Regards,

Awais
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03-17-2009, 10:09 PM
Post: #2
 
Interesting, How owner become slave without considering death, legal transfers etc ????????????????
Ex President and Governor..... can suggest .
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03-17-2009, 10:13 PM
Post: #3
 
<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by wasim akram</i>
<br />Interesting, How owner become slave without considering death, legal transfers etc ????????????????
Ex President and Governor..... can suggest .


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Dear wasim,

If you want to say something say it in clear words and sentences.

Please don't mind.

I have an urgent need of the answer of above question anybody can help me.

Regards,

Awais
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03-17-2009, 11:29 PM
Post: #4
 
No problem, In my opinion, termination of membership of any shareholder is never done. It is against the ownership rights. Let us see, I am also looking for any comment.
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03-18-2009, 01:54 AM
Post: #5
 
There is no concept of termination of membership / shareholding rights of a shareholder unless there is some outright defect in the title of shares in his name. Once the shares are properly transferred in his name, his membership/sharholding cannot be terminated.

This question is just like, "how could someone's ownership rights of his house be terminated".

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03-18-2009, 04:13 PM
Post: #6
 
This question has come in the papper of corporate Law of one of professional body of accountants.

Regards,

Awais
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03-19-2009, 08:26 AM
Post: #7
 
Mr.Awais i know about this question very well because jis attempt main yeh question aya tha usi attempt main maira yeh paper paas hoa tha.
Aap ko is say related company law main koi section nahi milay ga.
infact it is a general question.
Agar aap ko Barrister A.G.Chowdry ki book mil jaye to us k page 64 per aap ko is sawal ka full answer mil jaye ga.
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03-19-2009, 03:00 PM
Post: #8
 
Mr. Asad
Thanks a lot, I have some idea that it may be a general question because I have seen whole company law but I did not find this topic in the whole book of Nazir Ahmed Shaheen.

Regards,
Awais
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03-19-2009, 06:24 PM
Post: #9
 
Dear Raja & awais

whenever u find, Please append here the relevant portion of the said book for understanding at large.
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03-19-2009, 07:29 PM
Post: #10
 
Sure,why not
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06-29-2009, 04:23 PM
Post: #11
 
<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by retarded</i>
<br />Can any one still reply for this question?[D]
as i also took that exam but failed[(!]
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Company Ordinance 1984 does not specifically mention those circumstances under which membership is terminated, however,it may be appraised after going through some of the sections related to membership, and as per common practise , the following cases may result in a termination of mambership,
1. When a member <b>transfers</b> his shares and execute a transfer deed in favour of transferee.
2. When shares are validly <b>surrender</b>
3. In case of <b>transmission of shares </b> in favour of legal heirs, due to reasons specified.
4. In case of <b>redemption of preference shares</b>, if authorised by Memorandum and Articles.
5. When a member distributes his holding as a <b>gift</b> with a duly executed transfer deed.
6. When the name of any person is <b>removed from the register </b> of members.
7. When a company excercises its right to<b> lien </b> on the shares.
8. When a shareholder <b>repudiates the contract </b> to take allotted shares to him on the grounds of Misrepresentation in prospectus or due to irregular allotment.
9. In Case of <b>liquidation of company</b>.

In case of any further discussion , queries will be appreciated.

Best Regards,
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07-07-2009, 03:38 PM
Post: #12
 
Dear Faisal,

In my opinion you have mixed the concept of Termination of Membership with the transfer of shares, transmission of shares and subsequent transfer of shares.

Infact the law is silent regarding the termination of membership of a member. The termination of membership of a shareholder is an issue related to general corporate law as same as legal concepts perpetual succession, indoor management common seal and so on. Although company ordinance 1984, adopts these basic concepts of general company law but does not define them. A student of corporate law at professional level assumed to go through these basic concepts of company law which are used worldwide. Although the question of termination of membership is not a basic concept of company law but it is related to general company law. It is the practice of superior judiciary of Pakistan that if any law is silent about any particular issue then the judiciary examines law cases, sees common practice in the particular field and generally accepted world law relating to this particular field unless otherwise specified in law of a country.

It is general law that the membership of a shareholder cannot be terminated.

Regards,

Awais Aftab
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07-07-2009, 05:01 PM
Post: #13
 
<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by awaisaftab</i>
<br />Dear Faisal,

In my opinion you have mixed the concept of Termination of Membership with the transfer of shares, transmission of shares and subsequent transfer of shares.

Infact the law is silent regarding the termination of membership of a member. The termination of membership of a shareholder is an issue related to general corporate law as same as legal concepts perpetual succession, indoor management common seal and so on. Although company ordinance 1984, adopts these basic concepts of general company law but does not define them. A student of corporate law at professional level assumed to go through these basic concepts of company law which are used worldwide. Although the question of termination of membership is not a basic concept of company law but it is related to general company law. It is the practice of superior judiciary of Pakistan that if any law is silent about any particular issue then the judiciary examines law cases, sees common practice in the particular field and generally accepted world law relating to this particular field unless otherwise specified in law of a country.

It is general law that the membership of a shareholder cannot be terminated.

Regards,

Awais Aftab

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My Dear ,
I would suggest you to go through E-16 - A T Foulks Lynch , page number 46,
Furthermore, i already mentioned in my post that "Company Ordinance 1984 does not specifically mention those circumstances under which membership is terminated"
Please exhibit ,

Also note each of the mentioned cases separately,and ask yourself whether , if you transfer your shares, will you still be a member of a company although your name has been removed from the register due to transfer ?
If a company is liquidated, will you be called as a member of a company ? or a member of a liquidated company.
If a member dies and his holdings is transmitted to legal heirs, then still membership of a dead person will be counted????

Please read the book which is aforementioned, probably it shall be appropriate rather to debate on such a nugatory issues.



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07-08-2009, 02:29 PM
Post: #14
 
When a person will transfer his shares then it will be called Transfer of Shares. Similarly when if a company will liquidate then all shareholders will lose their membership and it will be called liquidation not termination of membership of shareholders.

Please read Page 64 of Book of A.G Chaudary.


Regards,

Awais Aftab
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07-08-2009, 05:33 PM
Post: #15
 
<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by awaisaftab</i>
<br />When a person will transfer his shares then it will be called Transfer of Shares. Similarly when if a company will liquidate then all shareholders will lose their membership and it will be called liquidation not termination of membership of shareholders.

Please read Page 64 of Book of A.G Chaudary.


Regards,

Awais Aftab

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Dear Awais,
when a person transfers his shares then it is called as transfer of shares, i agree, but what will you call regarding his membership? is he still a member or not ? if yes, then how? if no, then what will you call it? isn't it a cease of membership ?

Anyways, This issue may create a nugatory debate, since you are an active member over the forum, i would never like any embarrassment to be arisen between us, this may simply be a differentiation of mindset,
However, i am well aware that where this question had been asked , only those of the examinees were able to get through, who were able to reply to this question correctly, since Question did not ask to proof through Ordinance, it was a general question and generally those cases will terminate membership, which have already been discussed.

Thanks and Regards
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