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or administrator of that estate and shall, in respect of that share
be subject to the same liabilities and no more as he would have
been subject to if the share had remained registered in the name
of the deceased person.
(2) Any trustee, executor or administrator of the estate of any
deceased person who was beneficially entitled to a share in any
corporation, being a share registered in a register or branch register
kept in Malaysia may, with the consent of the corporation and of
the registered holder of that share, become registered as the holder
of that share as trustee, executor or administrator of that estate and
shall, in respect of the share, be subject to the same liabilities and
no more as he would have been subject to if the share had been
registered in the name of the deceased person.
(3) Shares in a corporation registered in a register or branch
register kept in Malaysia and held by a trustee in respect of a
particular trust may with the consent of the corporation, be marked
in the register or branch register in such a way as to identify them
as being held in respect of the trust.
(4) Except as provided in this section no notice of any trust
expressed, implied or constructive shall be entered on a register
or branch register or be receivable by the Registrar and no liabilities
shall be affected by anything done in pursuance of subsection (1),
(2) or (3) or pursuant to the law of any other place which corresponds
to this section and the corporation concerned shall not be affected
with notice of any trust by anything so done.
Branch registers
164. (1) A company having a share capital may cause to be kept
in any place outside Malaysia a branch register of members which
shall be deemed to be part of the company's register of members.
(2) The company shall lodge with the Registrar notice of the
situation of the office where any branch register is kept and of any
change in its situation, and if it is discontinued of its discontinuance,
and any such notice shall be lodged within one month after the
opening of the office or of the change or discontinuance, as the
case may be.
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(3) A branch register shall be kept in the same manner in which
the principal register is by this Act required to be kept.
(4) The company shall transmit to the office at which its principal
register is kept a copy of every entry in its branch register as soon
as may be after the entry is made, and shall cause to be kept at
that office duly entered up from time to time a copy of its branch
register, which shall for all purposes of this Act be deemed to be
part of the principal register.
(5) Subject to the provisions of this section with respect to the
copy register the shares registered in a branch register shall be
distinguished from the shares registered in the principal register,
and no transaction with respect to any shares registered in a branch
register shall during the continuance of that registration be registered
in any other register.
(6) A company may discontinue a branch register and thereupon
all entries in that register shall be transferred to some other branch
register kept by the company in the same place or to the principal
register.
(7) This section shall apply to all companies incorporated within
Malaysia by or under any Federal or State law.
(8) If by virtue of the law in force in any other country any
corporation incorporated under that law keeps in Malaysia a branch
register of its members, the Minister may by order declare that the
provisions of this Act relating to inspection, place of keeping and
r e c t i f i c a t i o n of registers of members shall, subject to any
modifications specified in the order, apply to and in relation to any
such branch register kept in Malaysia as they apply to and in
relation to the registers of companies under this Act and thereupon
those provisions shall apply accordingly.
(9) If default is made in complying with this section the company
and every officer of the company who is in default and every
person who, pursuant to section 159 has arranged to make up the
principal register, and who is in default shall be guilty of an
offence against this Act.
Penalty: *One thousand ringgit. Default penalty.
*NOTE--Previously "two hundred and fifty ringgit"see Companies (Amendment) Act 1986 [Act A657].
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DIVISION 5
ANNUAL RETURN
Annual return by company having a share capital
165. (1) Every company having a share capital shall make a return
containing the particulars referred to in Part l of the Eighth Schedule
and accompanied by such copies of documents as are required to
be included in the return in accordance with Part ll of that Schedule
and such of the certificates and other particulars prescribed in that
Part as are applicable to the company.
(2) The return shall be in accordance with the form set out
i n Part II of the Eighth Schedule or as near thereto as
circumstances admit and shall be made up to the date of the
annual general meeting of the company in the year or a date not
later than the fourteenth day after the date of the annual general
meeting.
(3) In the case of a company keeping a branch register the
particulars of the entries in that register shall, so far as they relate
to matters which are required to be stated in the return, be included
in the return made next after copies of those entries are received
at the registered office of the company.
(4) The annual return signed by a director or by the manager
or secretary of the company shall be lodged with the Registrar
within one month or in the case of a company keeping pursuant
to its articles a branch register in any place outside Malaysia
within two months after the annual general meeting.
Annual return by company not having a share capital
(5) A company not having a share capital shall, within one
month after each annual general meeting of the company, lodge
with the Registrar a return in the prescribed form containing the
particulars referred to in subsection (6) and made up to the date
of the annual general meeting or a date not later than the fourteenth
day after the date of the annual general meeting.
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(6) The return of a company not having a share capital shall
contain---
(a) the address of the registered office of the company;
(b) in a case in which the register of members is, under this
Act, kept elsewhere than at that office, the address of the
place where it is kept;
(c) particulars of the total amount of the indebtedness of the
company in respect of all charges, whether required to
be registered with the Registrar or not;
(d) all such particulars with respect to the persons who, on
the day to which the return is made up, are the directors,
managers or secretaries of the company as are required
to be contained in the register of directors, managers and
secretaries;
(e) the name and address of the auditor of the company; and
(f) such other matters relating to the accounts of the company
and to the unclaimed moneys held by the company as are
prescribed.
(7) If a company fails to comply with this section, the company
and every officer of the company who is in default shall be guilty
of an offence against this Act.
Penalty: *Two thousand ringgit. Default penalty.
Auditor's statements
165A. (1) A company that is not required by this Act to lodge
accounts with the Registrar shall include in or attach to its annual
return under section 165 a statement relating to the accounts of the
company required to be laid before the company at its annual
general meeting held on the date to which the return is made up
or if an annual general meeting is not held on that date, the annual
general meeting last preceding that date, signed by the auditor of
the company--
(a) stating whether the company has in his opinion kept
proper accounting records and other books during the
period covered by those accounts;
*NOTE--Previously "five hundred ringgit"see Companies (Amendment) Act 1986 [Act A657].
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(b) stating whether the accounts have been audited in
accordance with this Act;
(c) stating whether the auditor's report on the accounts was
made subject to any qualification, or included any comment
made under subsection 174(3), and, if so, particulars of
the qualification or comment; and
(d) stating whether as at the date to which the profit and loss
account has been made up, the company appeared to
have been able to meet its liabilities as and when they
fall due.
(2) If a company fails to comply with this section, the company
and every officer of the company who is in default shall be guilty
of an offence against this Act.
Exemption from filing list of members with annual return for
certain public companies
166. (1) A public company which--
(a) has more than five hundred members; and
(b) provides reasonable accommodation and facilities for
persons to inspect and take copies of its list of members
and its particulars of shares transferred,
need not comply with such of the provisions of this Division and
the Eighth Schedule as relate to the inclusion in the annual return
of a list of members if there is included in the annual return--
(A) a certificate by the secretary that the company is of a
kind to which this subsection applies; and
(B) a list showing the prescribed particulars of the twenty
largest holders of each class of equity shares.
(2) The Minister may, by notice published in the Gazette require
any company to which subsection (1) applies to comply with all
or any of the provisions of this Division or of the Eighth Schedule
referred to in subsection (1).
(3) If default is made in complying with the notice given under
subsection (2), the company and every officer of the company who
is in default shall be guilty of an offence against this Act.
Penalty: *Two thousand ringgit. Default penalty.
*NOTE--Previously "five hundred ringgit"see Companies (Amendment) Act 1986 [Act A657].
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PART VI
ACCOUNTS AND AUDIT
DIVISION 1
ACCOUNTS
Compliance with approved accounting standards
166A. (1) In this Part unless the contrary intention appears, "approved
accounting standards" shall have the meaning assigned thereto in
section 2 of the Financial Reporting Act 1997 [Act 558].
(2) The approved accounting standards shall apply to the accounts
of a company or the consolidated accounts of a holding company
if, at the time when the accounts or consolidated accounts are
made out, the approved accounting standards--
(a) apply in relation to the financial year of the company or
the holding company to which the accounts or consolidated
accounts relate; and
(b) are relevant to those accounts or consolidated accounts.
(3) Without prejudice to the generality of the provisions of this
Division, the directors of a company shall ensure that the accounts
of the company and, if the company is a holding company for
which consolidated accounts are required, the consolidated accounts
of the company, laid before the company at its annual general
meeting are made out in accordance with the applicable approved
accounting standards.
(4) Notwithstanding subsection (3), the directors of a company
or holding company shall not be required to ensure that the accounts
or consolidated accounts, as the case may be, are made out in
accordance with a particular approved accounting standard if they
are of the opinion that making out the accounts or consolidated
accounts in accordance with the approved accounting standard
would not give a true and fair view of the matters required by
section 169 to be dealt with in the accounts or consolidated accounts
or a true and fair view of the results of the business and the state
of affairs of the company and, if applicable, of all the companies
the affairs of which are dealt with in the consolidated accounts.
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(5) Where the accounts or consolidated accounts of a company
are not made out in accordance with a particular approved accounting
standard under subsection (4), the directors of the company shall--
(a) disclose by way of a note on the accounts their reason
for not making out the accounts or consolidated accounts
in accordance with the approved accounting standard;
and
(b) give particulars in the note of the quantified financial
effect on the accounts or consolidated accounts if the
relevant approved accounting standard was complied with.
(6) Notwithstanding subsection 169(14), where any conflict or
inconsistency arises between the provisions of an applicable approved
accounting standard and a provision in the Ninth Schedule in their
respective applications to the accounts or consolidated accounts of
a company, the provisions of the applicable approved accounting
standard shall prevail.
Accounts to be kept
167. (1) Every company and the directors and managers thereof
shall cause to be kept such accounting and other records as will
sufficiently explain the transactions and financial position of the
company and enable true and fair profit and loss accounts and
balance sheets and any documents required to be attached thereto
to be prepared from time to time, and shall cause those records
to be kept in such manner as to enable them to be conveniently
and properly audited.
(1A) Every company and the directors and managers thereof
shall cause appropriate entries to be made in the accounting and
other records within sixty days of the completion of the transactions
to which they relate.
(2) The company shall retain the records referred to in subsection
(1) for seven years after the completion of the transactions or
operations to which they respectively relate.
(3) The records referred to in subsection (1) shall be kept at the
registered office of the company or at such other place in Malaysia
as the directors think fit and shall at all times be open to inspection
by the directors.
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(4) N o t w i t h s t a n d i n g the provisions in subsection (3), the
accounting and other records of operations outside Malaysia may
be kept by the company at a place outside Malaysia and there shall
be sent to and kept at a place in Malaysia and be at all times open
to inspection by the directors, such statements and returns with
respect to the business dealt with in the records so kept as will
enable to be prepared true and fair profit and loss accounts and
balance sheets and any documents required to be attached thereto.
(5) If any accounting and other records are kept at a place
outside Malaysia pursuant to subsection (4), the company shall, if
required by the Registrar to produce those records at a place in
Malaysia, comply with the requirements.
(6) The Court may in any particular case order that the accounting
and other records of a company be open to inspection by an
approved company auditor acting for a director, but only upon an
undertaking in writing given to the Court that information acquired
by the auditor during his inspection shall not be disclosed by him
except to that director.
(7) If default is made in complying with this section the company
and every officer of the company who is in default shall be guilty
of an offence against this Act.
Penalty: Imprisonment of *six months or five thousand ringgit
or both.
As to accounting periods of companies within the same group
168. (1) Subject to subsections (11) and (12) the directors of
every holding company that is not a foreign company shall take
such steps as are necessary to ensure that--
(a) within two years after the commencement of this Act, the
financial years of each of its subsidiaries coincide with
the financial year of the holding company; and
(b) within two years after any corporation becomes a subsidiary
o f the holding company, the financial year of that
corporation coincides with the financial year of the holding
company.
*NOTE--Previously "three months or five hundred ringgit"see Companies (Amendment) Act 1985
[Act A616].
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(2) Where the financial year of a holding company that is not
a foreign company and that of each of its subsidiaries coincide,
the directors of the holding company shall at all times take such
steps as are necessary to ensure that without the consent of the
Registrar the financial year of the holding company or any of its
subsidiaries is not altered so that all such financial years do not
coincide.
(3) Where the directors of the holding company are of the
opinion that there is good reason why the financial year of any of
its subsidiaries should not coincide with the financial year of the
holding company, the directors may apply in writing to the Registrar
for an order authorizing any subsidiary to continue to have or to
adopt (as the case requires) a financial year which does not coincide
with that of the holding company.
(4) The application shall be supported by a statement by the
directors of the holding company of their reasons for seeking the
order.
(5) The Registrar may require the directors who make an
application under this section to supply such information relating
to the operation of the holding company and of any corporation
that is deemed by virtue of section 6 to be related to the holding
company as he thinks necessary for the purpose of determining the
application.
(6) The Registrar may at the expense of the holding company
of which the applicants are directors request any approved company
auditor to investigate and report on the application.
(7) The Registrar may rely upon any report obtained pursuant
to subsection (6) from the approved company auditor.
(8) The Registrar may make on order granting or refusing the
application or granting the application subject to such limitations,
terms or conditions as he thinks fit and shall serve the order on
the holding company.
(9) Where the applicants are aggrieved by any order made by
the Registrar, the applicants may, within two months after the
service of the order upon the holding company, appeal against the
order to the Minister.
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(10) The Minister shall determine the appeal and in determining
the appeal may make any order that the Registrar had power to
make on the original application and may exercise any of the
powers that the Registrar might have exercised in relation to the
original application.
(11) Where the directors of a holding company have applied to
the Registrar for an order authorizing any subsidiary to continue
to have a financial year which does not coincide with that of the
holding company, the operation of subsection (1) shall be suspended
in relation to that subsidiary until the determination of the application
and of any appeal arising out of the application.
(12) Where an order is made authorizing any subsidiary to have
a financial year which does not coincide with that of the holding
company, compliance with the terms of the order of the Registrar
or where there has been an appeal, compliance with the terms of
any order made on the determination of the appeal shall be deemed
to be a compliance with subsection (1) in relation to that subsidiary,
but where an application for such an order and the appeal, if any,
arising out of that application are refused the time within which
the directors of the holding company are required to comply with
subsection (1) in relation to that subsidiary shall be deemed to be
the period of twelwe months after the date upon which the order
of the Registrar is served on the holding company or the period
of twelwe months after the determination of the appeal, as the case
may be.
(13) Where the directors of a holding company have applied to
the Registrar for an order authorizing any of its subsidiaries to
continue to have or to adopt a financial year which does not
coincide with that of the holding company and the application and
the appeal, if any, arising out of that application, have been
refused, the directors of the holding company shall not make a
similar application with respect to that subsidiary within three
years after the refusal of the application or where there is an
a p p e a l , after the determination of that appeal unless the
Registrar is satisfied that there has been a substantial change
in the relevant facts or circumstances since the refusal of the
former application or the determination of the appeal, as the case
may be.
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Profit and loss account, balance sheet and directors' report
169. (1) The directors of every company shall, at some date not
later than eighteen months after the incorporation of the company
and subsequently once at least in every calender year at intervals
of not more than fifteen months, lay before the company at its
annual general meeting a profit and loss account for the period
since the preceding account (or in the case of the first account,
since the incorporation of the company) made up to a date not
more than six months before the date of the meeting.
(2) Notwithstanding subsection (1) the Registrar on application
by the company, if for any special reason he thinks fit so to do,
may extend the periods of eighteen months and fifteen months
referred to in that subsection and with respect to any year extend
the period of six months referred to in that subsection, notwithstanding
that period is so extended beyond the calender year.
(3) The directors of every company shall cause to be made out,
and to be laid before the company at its annual general meeting
with the profit and loss account required by subsection (1) a balance
sheet as at the date to which the profit and loss account is made
up.
(4) The profit and loss account and the balance sheet of a
company shall be duly audited before they are laid before the
company at its annual general meeting as required by this section.
(5) The directors of a company shall cause to be attached to
every balance sheet made out under subsection (3) a report made
in accordance with a resolution of the directors and signed by not
less than two of the directors with respect to the profit or loss of
the company for the financial year and the state of the company's
affairs as at the end of the financial year and if the company is
a holding company also a report with respect to the state of affairs
of the holding company and all its subsidiaries.
(6) Each report to which subsection (5) relates shall state with
appropriate details--
(a) the names of the directors in office since the date of the
last report;
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(b) the principal activities of the company in the course of
the financial year and any significant change in the nature
of those activities during the period;
(c) the net amount of the profit or loss of the company for
the financial year after provision for income tax;
(d) the amounts and particulars of any material transfer to
or from reserves or provisions;
(e) where, during the financial year, the company has issued
and shares or debetures--the purposes of the issue, the
classes of shares or debentures issued, the number of
shares of each class and the amount of debentures of each
class, and the terms of issue of the shares and debentures
of each class;
(f) whether at the end of that financial year--
(i) there subsist arrangements to which the company
is a party, being arrangements with the object of
enabling directors of the company to acquire benefits
b y means of the acquisition of shares in, or
debentures of, the company or any other body
corporate; or
(ii) there have, at any time in that year, subsisted such
arrangements as aforesaid to which the company
was a party, and if so the report shall contain a
statement explaining the effect of the arrangements
and giving the names of the persons who at any
time in that year were directors of the company
and held, or whose nominees held, shares or
d e b e n t u r e s acquired in pursuance of the
arrangements;
(g) in respect of each person who, at the end of the financial
year, was a director of the company--
(i) whether or not (according to the register kept by
the company for the purposes of section 134 relating
to the obligation of a director of a company to
nofity such company of his interests in shares in,
or debentures of, the company and of every other
body corporate, being the company's subsidiary
or holding company or a subsidiary of the company's
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holding company) he was at the end of that year,
interested in shares in, or debentures of the company
or any other such body corporate and , if he was
so interested, the number and amount of shares in,
and debentures of, each body (specifying it) in
which, according to that register, he was then
interested;
(ii) whether or not, according to that register, he was,
at the beginning of that year (or, if he was not
then a director), when he became a director,
interested in shares in, or debentures of, the company
or any other such body corporate and, if he was
so interested, the number and amount of shares in,
and debentures of, each body (specifying it) in
which according to that register, he was interested
at the beginning of that year or, as the case may
be, when he became a director; and
(iii) the total number of shares in or debentures of the
company or any other such corporate bought and
sold by him during that financial year;
(h) the amount, if any, which the directors recommended
should be paid by way of dividend, and any amounts
which have been paid or declared by way of dividend
since the end of the previous financial year, indicating
which of those amounts, if any, have been shown in a
p r e v i o u s report under this subsection or under a
corresponding repealed provision of this Act;
(i) whether the directors (before the profit and loss account
and balance sheet were made out) took reasonable steps
to ascertain what action had been taken in relation to the
writing off of bad debts and the making of provision for
doubtful debts, and satisfied themselves that all known
bad debts had been written off and that adequate provision
had been made for doubtful debts;
(j) whether at the date of the report the directors are aware
of any circumstances which would render the amount
written off for bad debts or the amount of the provision
for doubtful debts inadequate to any substantial extent
and, if so, giving particulars of the circumstances;
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(k) whether the directors (before the profit and loss account
and balance sheet were made out) have taken reasonable
steps to ensure that any current assets which were unlikely
to be realized in the ordinary course of business including
their value as shown in the accounting records of the
company have been written down to an amount which
they might be expected so to realize;
(l) whether at the date of the report the directors are aware
of any circumstances--
(i) which would render the values attributed to current
assets in the accounts misleading; and
(ii) which have arisen which render adherence to the
existing method of valuation of assets or liabilities
of the company misleading or inappropriate;
and, if so, giving particulars of the circumstances;
(m) whether there exists at the date of the report--
(i) any charge on the assets of the company which
has arisen since the end of the financial year which
secures the liabilities of any other person and, if
so, giving particulars of any such charge and, so
far as practicable, of the amount secured; and
(ii) any contingent liability which has arisen since the
end of the financial year and, if so, stating the
general nature thereof and, so far as practicable,
t h e maximum amount, or an estimate of the
maximum amount, for which the company could
become liable in respect thereof;
(n) whether any contingent or other liability has become
enforceable, or likely to become enforceable, within the
period of twelwe months after the end of the financial
year which, in the opinion of the directors, will or may
affect the liability of the company to meet its obligations
when they fall due and, if so, giving particulars of any
such liability;
(o) whether at the date of the report the directors are aware
of any circumstances not otherwise dealt with in the
report or accounts which would render any amount stated
in the accounts misleading and, if so, giving particulars
of the circumstances;
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(p) whether the results of the company's operations during
the financial year were, in the opinion of the directors,
s u b s t a n t i a l l y affected by any item, transaction or
event of a material and unusual nature and, if so, giving
particulars of that item, transaction or event and the
amount or the effect thereof, if known or reasonably
ascertainable; and
(q) whether there has arisen in the interval between the end
of the financial year and the date report any item, transaction
or event of a material and unusual nature likely, in the
opinion of the directors, to affect substantially the results
of the company's operations for the financial year in
which the report is made and, if so, giving particulars of
the item, transaction or event.
(7) In subsection (6) of this section, the expression "any item,
transaction or event of a material and unusual nature" includes but
is not limited to--
(a) any change in accounting policies adopted since the last
report;
(b) any material change in the method of valuation of the
whole or any part of the trading stock;
(c) any material item appearing in the accounts or consolidated
accounts for the first time or not usually included in the
accounts or consolidated accounts; and
(d) any absence from the accounts or consolidated accounts
of any material item usually included in the accounts or
consolidated accounts.
(8) The directors of a company shall state in the report whether
a director of the company has since the end of the previous financial
year received or become entitled to receive a benefit (other than
a benefit included in the aggregate amount of emoluments received
or due and receivable by the directors shown in the accounts or
the fixed salary of a full-time employee of the company) by reason
of a contract made by the company or a related corporation with
the director or with a firm of which he is a member, or with a
company in which he has a substantial financial interest, and, if
so, the general nature of the benefit.
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(9) Every statements, report or other document relating to the
affairs of a company or any of its subsidiaries attached to, or
included with, a report of the directors laid before the company
at its general meeting or sent to the members under section 170
(not being a statements, report or document required by this Act
to be laid before the company in general meeting) shall, for the
purposes of section 364 be deemed to be part of that last-mentioned
report.
(10) Where at the end of a financial year a company is the
subsidiary of another corporation, the directors of the company
shall state in, or in a note as a statement annexed to, the company's
accounts laid before the company at its annual general meeting the
name of the corporation regarded by the directors as being the
company's ultimate holding company and if known to them the
country in which it is incorporated.
(11) Where any option has been granted during the period covered
by the profit and loss account to take up unissued shares of a
company the report required by subsection (5) shall state--
(a) the name of the person to whom the option has been
granted;
(b) the number and class of shares in respect of which the
option has been granted;
(c) the date of expiration of the option;
(d) the basis upon which the option may be exercised; and
(e) whether the person to whom the option has been granted
has any right to participate by virtue of the option in any
share of any other company.
(12) Each report required by subsection (5) shall specify--
(a) particulars of shares issued during the period to which
the report relates by virtue of the exercise of options to
take up unissued shares of the company, whether granted
before or during that period; and
(b) the number and class of unissued shares of the company
under option as at the end of that period, the price, or
method of fixing the price, of issue of those shares, the
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date of expiration of the option and the rights, if any, of
the persons to whom the options have been granted to
participate by virtue of the options in any share issue of
any other company;
(c) (Deleted by Act A616).
(13) Paragraph (11)(a) shall not apply in any case where the
option to take up shares of the company has been conferred generally
on all the holders of a class of shares or debentures of the company.
(14) Every balance sheet referred to in subsection (3) shall give
a true and fair view of the state of affairs of the company as at
the end of the period to which it relates and every profit and loss
account referred to in subsection (1) shall give a true and fair view
of the profit or loss of the company for the period of accounting
as shown in the accounting and other records of the company, and
without affecting the generality of the foregoing, every such balance
sheet and profit and loss account shall comply with the requirements
of the Ninth Schedule so far as applicable thereto.
(15) The directors of a company shall cause to be attached to
every balance sheet and profit and loss account laid before the
company in general meeting (including any consolidated balance
sheet and consolidated profit and loss account of a holding company)
a statement made in accordance with a resolution of the directors
and signed by at least two directors stating whether, in the opinion
of the directors--
(a) the profit and loss account and, where applicable, the
consolidated profit and loss account, is or are drawn up
so as to give a true and fair view of the results of the
business of the company and, if applicable, of all the
companies the accounts of which are dealt with in the
consolidated profit and loss account for the period covered
by the account;
(b) the balance sheet, and where applicable the consolidated
balance sheet, is or are drawn up so as to give a true and
fair view of the state of affairs of the company and, if
applicable, of all the companies the affairs of which are
dealt with in the consolidated balance sheet as at the end
of that period; and
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(c) the accounts, and where applicable the consolidated
accounts, have been made out in accordance with the
applicable approved accounting standards.
(16) Every balance sheet and profit and loss account of a company
l a i d before the company in general meeting (including any
consolidated balance sheet and consolidated profit and loss account
annexed to the balance sheet and profit and loss account of a
holding company) shall be accompanied by a statutory declaration
by a director or where that director is not primarily responsible
for the financial management of the company by the person so
responsible setting forth his opinion as to the correctness or otherwise
of the balance sheet and profit and loss account and, where applicable,
the consolidated balance sheet and consolidated profit and loss
account.
(17) Any document (other than a balance sheet prepared in
accordance with this Act) or advertisement published issued or
circulated by or on behalf of a company (other than a banking
corporation) shall not contain any direct or indirect representation
that the company has any reserve unless the representation is
accompanied--
(a) if the reserve is invested outside the business of the
company--by a statement showing the manner in which
and the security upon which it is invested; or
(b) if the reserve is being used in the business of the company--
by a statement to the effect that the reserve is being so
used.
(18) To the extent that any company registered under any written
law relating to insurance is required to prepare balance sheets,
revenue accounts and profit and loss accounts in the form prescribed
by that law, the company shall be deemed to have complied with
the requirements of subsections (5) to (17) and the Ninth Schedule
if its balance sheet and profit and loss account is made out in
accordance with that law but if the company carries on business
other than insurance business so far as that law does not require
the company to deal with any matters which are required to be
dealt with under the Ninth Schedule, it shall be necessary for the
company to comply with this section and the Ninth Schedule.
(19) The provisions of this Act relating to the form and content
of the report of the directors and the annual balance sheet and
profit and loss account shall apply to a banking corporation and
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a licensed finance company, a licensed discount house, a licensed
money-broker, a scheduled institution in respect of which the
Minister charged with responsibility for finance has made an
o r d e r under subsection 24(1) of the Banking and Financial
Institutions Act 1989 and a non-scheduled institution in respect of
which such Minister has made an order under subsection 93(1) of
that Act with such modifications and exceptions as are determined
either generally or in any particular case by the Bank Negara
Malaysia.
Relief from requirements as to form and content of accounts
and reports
169A. (1) The directors of a company may apply to the Registrar
in writing for an order relieving them from any requirement of this
Act relating to the form and content of accounts or consolidated
accounts or to the form and content of the report required by
subsection 169(6) and the Registrar may make such an order either
unconditionally or on condition that the directors comply with
such other requirements relating to the form and content of the
accounts or consolidated accounts or report as the Registrar thinks
fit to impose.
(2) The Registrar may where he considers it appropriate make
an order in respect of any class of companies relieving the directors
of a company in that class from compliance with any specified
requirements of this Act relating to the form and content of accounts
or consolidated accounts or to the form and content of the report
required by subsection 169(6) and the order may be made either
unconditionally or on condition that the directors of the company
comply with such other requirements relating to the form and
content of accounts or consolidated accounts or report as the Registrar
thinks fit to impose.
(3) The Registrar shall not make an order under subsection (1)
unless he is of the opinion that compliance with the requirements
of this Act would--
(i) render the accounts or consolidated accounts or
r e p o r t , as the case may be, misleading or
inappropriate to the circumstances of the company;
or
(ii) impose unreasonable burdens on the company or
any officer of the company.
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(4) The Registrar may make an order under subsection (1) which
may be limited to a specific period and may from time to time
either on application by the directors or without any such application
(in which case the Registrar shall give to the directors an opportunity
of being heard) revoke or suspend the operation of any such order.
Power of Registrar to require a statement of valuation of assets
169B. (1) The Registrar may, with notice in writing, require the
directors of any company to supply a statement of valuation at
current value of assets and liabilities of the company within the
time specified in the notice.
(2) The Registrar may, on the application of the company and
in his absolute discretion, extend the period of time so specified
in the notice referred to in subsection (1).
Members of company entitled to balance sheet, etc.
170. (1) A copy of every profit and loss account and balance
sheet (including every document required by law to be attached
thereto) which is to be laid before company in general meeting
accompanied by a copy of the auditor's report thereon shall, not
less than fourteen days before the date of the meeting, be sent to
all persons entitled to receive notice of general notice of general
meeting of the company:
Provided that if the copies of the documents aforesaid are sent
less than fourteen days before the date of the meeting, they shall,
notwithstanding that fact, be deemed to have been duly sent if it
is so agreed by all the members entitled to attend and vote at the
meeting.
(2) Any member of a company (whether he is or is not entitled
to have sent to him copies of the profit and loss accounts and
balance sheets) to whom copies have not been sent and any holder
of a debenture shall, on a request being made by him to the
company, be furnished by the company without charge with a copy
of the last profit and loss account and balance sheet of the company
(including every document required by this Act to be attached
thereto) together with a copy of the auditor's report thereon.
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(3) If default is made in complying with subsection (1) or (2)
the company and every officer of the company who is in default
shall be guilty of an offence against this Act, unless it is proved
that the member or holder of a debenture in question has already
made a request for and been furnished for and been furnished with
a copy of the document.
Penalty: Two thousand five hundred ringgit. Default penalty.
Penalty
171. (1) If any director of a company fails to comply or to take
all reasonable steps to secure compliance by the company with the
foregoing provisions of this Division or has by his own wilful act
been the cause of any default by the company thereunder, he shall
be guilty of an offence against this Act.
Penalty: Imprisonment for *five years or thirty thousand ringgit.
(2) (Deleted by Act A616).
(3) A person shall not be sentenced to imprisonment for any
offence under this section unless in the opinion of the Court dealing
with the case the offence was committed wilfully.
DIVISION 2
AUDIT
Appointment and remuneration of auditors
172. (1) At any time before the first annual general meeting of
a company, the directors of the company may appoint, or (if the
directors do not make an appointment) the company at a general
meeting may appoint, a person to be the auditor of the company,
and any auditor so appointed shall, subject to this section, hold
office until the conclusion of the first annual general meeting.
(2) A company shall at each annual general meeting of the
company appoint a person to be the auditor of the company, and
any auditors so appointed shall, subject to this section, hold office
until the conclusion of the next annual general meeting of the
company.
*NOTE--Previously "two years or five thousand ringgit"see Companies (Amendment) Act 1986
[Act A657].
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(3) Subject to subsections (7) and (8), the directors of a company
may appoint an approved company auditor to fill any casual vacancy
in the office of auditor of the company, but while such a vacancy
continues the surviving or continuing auditor, if any, may act.
(4) An auditor of a company may be removed from office by
resolution of the company at a general meeting of which special
notice has been given, but not otherwise.
(5) Where special notice of a resolution to remove an auditor
is received by a company--
(a) it shall forthwith send a copy of the notice to the auditor
concerned and to the Registrar; and
(b) the auditor may, within seven days after the receipt by
him of the copy of the notice make representations in
writing to the company (not exceeding a reasonable length)
and request that, prior to the meeting at which the resolution
is to be considered, a copy of the representations be sent
by the company to every member of the company to
whom notice of the meeting is sent.
(6) Unless the Registrar on the application of the company
otherwise orders, the company shall send a copy of the representations
as so requested and the auditor may (without prejudice to his right
to be heard orally) require that the representations be read out at
the meeting.
(7) Where an auditor of a company is removed from office in
pursuance of subsection (4) at a general meeting of the company--
(a) the company may, at the meeting, by a resolution passed
by a majority of not less than three-fourths of such members
of the company as being entitled so to do vote in person
or, where proxies are allowed, by proxy forthwith appoint
another person nominated at the meeting as auditor; or
(b) the meeting may be adjourned to a date not earlier than
twenty days and not later than thirty days after the meeting
and the company may, by ordinary resolution, appoint
another person as auditor, being a person notice of whose
nomination as auditor has, at least ten days before the
resumption of the adjourned meeting, been received by
the company.
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(8) A company shall, forthwith after the removal of an auditor
from office in pursuance of subsection (4), give notice in writing
of the removal to the Registrar and, if the company does not
appoint another auditor under subsection (7), the Registrar shall
appoint an auditor.
(9) An auditor appointed in pursuance of subsection (7) or (8)
shall, subject to this section, hold office until the conclusion of
the next annual general meeting of the company.
(10) If a company does not appoint an auditor as required by
this section, the Registrar may on the application in writing of any
member of the company make the appointment.
(11) Subject to subsection (7), a person shall not be capable of
being appointed auditor of a company at an annual general unless
he held office as auditor of the company immediately before the
meeting or notice of his nomination as auditor was given to the
company by a member of the company not less than twenty-one
days before the meeting.
(12) Where notice of nomination of a person as an auditor of
a company is received by the company whether for appointment
at an adjourned meeting under subsection (7) or at an annual
general meeting, the company shall, not less than seven days
before the adjourned meeting or the annual general meeting, send
a copy of the notice to the person nominated, to each auditor, if
any, of the company and to each person entitled to receive notice
of general meetings of the company.
(13) If, after notice of nomination of a person as an auditor of
a company has been given to the company, the annual general
meeting of the company is called for a date twenty-one days
or less after the notice has been given, subsection (11) shall
not apply in relation to the person and, if the annual general
meeting is called for a date not more than seven days after the
notice has been given and a copy of the notice is, at the time
notice of the meeting is given, sent to each person to whom, under
subsection (12), it is required to be sent, the company shall be
deemed to have complied with that subsection in relation to
the notice.
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(14) An auditor of a company may resign--
(a) if he is not the sole auditor of the company; or
(b) at a general meeting of the company,
but not otherwise.
(15) If an auditor gives notice in writing to the directors of the
company that he desires to resign, the directors shall call a general
meeting of the company as soon as is practicable for the purpose
of appointing an auditor in place of the auditor who desires to
resign and on the appointment of another auditor the resignation
shall take effect.
(16) The fees and expenses of an auditor of a company--
(a) in the case of an auditor appointed by the company at a
general meeting--shall be fixed by the company in general
meeting or, if so authorized by the members at the last
preceding annual general meeting, by the directors; and
(b) in the case of an auditor appointed by the directors or by
the Registrar--may be fixed by the directors or by the
Registrar, as the case may be and, if not so fixed, shall
be fixed as provided in paragraph (a) as if the auditor had
been appointed by the company.
Auditors' remuneration
173. (1) If a company is served with a notice sent by or on behalf
of--
(a) at least five per centum of the total number of members
of the company; or
(b) the holders in aggregate of not less than five per centum
in nominal value of the company's issued share capital,
requiring particulars of all emoluments paid to or receivable by the
auditor of the company or any person who is a partner or employer
or employee of the auditor, by or from the company or any subsidiary
in respect of services other than auditing services rendered to the
company, the company shall forthwith--
(c) prepare or cause to be prepared a statement showing
particulars of all emoluments paid to the auditor or other
person and of the services in respect of which the payments
have been made for the financial year immediately
preceding the service of the notice;
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(d) forward a copy of the statement to all persons entitled to
receive notice of general meetings of the company; and
(e) lay the statement before the company in general meeting.
(2) If default is made in complying with this section the company
and every director of the company who is in default shall be guilty
of an offence against this Act.
Penalty: Two thousand five hundred ringgit.
Powers and duties of auditors as to reports on accounts
174. (1) Every auditor of a company shall report to the members
on the accounts required to be laid before the company in general
meeting and on the company's accounting and other records relating
to those accounts and if it is a holding company for which consolidated
accounts are prepared shall also report to the members on the
consolidated accounts.
(2) An auditor shall, in a report under this section, state--
(a) whether the accounts and, if the company is a holding
company for which consolidated accounts are prepared,
the consolidated accounts are in his opinion property
drawn up--
(i) so as to give a true and fair view of the matters
required by section 169 to be dealt with in the
accounts and, if there are consolidated accounts,
in the consolidated accounts;
(ii) in accordance with the provisions of this Act so
as to give a true and fair view of the company's
affairs; and
(iii) i n accordance with the applicable approved
accounting standards;
(aa) if in his opinion the accounts, and where applicable the
c o n s o l i d a t e d accounts, have not been drawn up in
accordance with a particular applicable approved accounting
standard--
(i) whether in his opinion the accounts or consolidated
accounts, as the case may be, would, if drawn up
i n accordance with the approved accounting
standard, have given a true and fair view of the
matters required by section 169 to be dealt with
in the accounts or consolidated accounts;
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(ii) if in his opinion the accounts or consolidated
accounts, as the case may be, would not, if so
drawn up, have given a true and fair view of those
matters, his reasons for holding that opinion;
(iii) if the directors have given the particulars of the
quantified financial effect under subsection 166A(5),
his opinion concerning the particulars; and
(iv) in a case to which neither subparagraph (ii) nor
(iii) applies, particulars of the quantified financial
effect on the accounts or consolidated accounts of
the failure to so draw up the accounts or consolidated
accounts, as the case may be;
(b) whether the accounting and other records and the registers
required by this Act to be kept by the company and, if
it is a holding company, by the subsidiaries other than
those of which he has not acted as auditor have been, in
his opinion, properly kept in accordance with the provisions
of this Act;
(c) in the case of consolidated accounts --
(i) the names of the subsidiaries, if any, of which he
has not acted as auditor;
(ii) whether he has considered the accounts and auditor's
reports of all subsidiaries of which he has not
acted as auditor, being accounts that are included
(whether separately or consolidated with other
accounts) in the consolidated accounts;
(iii) whether he is satisfied that the accounts of the
s u b s i d i a r i e s that are consolidated with other
accounts are in form and content appropriate and
proper for the purposes of the preparation of the
consolidated accounts, and whether he has received
satisfactory information and explanations as required
by him for those purposes; and
(iv) whether the auditor's report on the accounts of
any subsidiary was made subject to any qualification
(other than a qualification that is not material in
relation to the consolidated accounts), or included
any comment made under subsection (3), and, if
so, particulars of the qualification or comment;
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(d) any defect or irregularity in the accounts or consolidated
accounts and any matter not set out in the accounts or
consolidated accounts without regard to which a true and
fair view of the matters dealt with by the accounts or
consolidated accounts would not be obtained; and
(e) if he is not satisfied as to any matter referred to in paragraph
(a), (b) or (c), his reasons for not being so satisfied.
(3) It is the duty of an auditor of a company to form an opinion
as to each of the following matters:
(a) whether he has obtained all the information and explanations
that he required;
(b) whether proper accounting and other records (including
registers) have been kept by the company as required by
this Act;
(c) whether the returns received from branch offices of the
company are adequate; and
(d) whether the procedures and methods used by a holding
company or a subsidiary in arriving at the amount taken
into any consolidated accounts were appropriate to the
circumstances of the consolidation,
and he shall state in his report particulars of any deficiency, failure
or shortcoming in respect of any matter referred to in this subsection.
(4) An auditor of a company has a right of access at all reasonable
times to the accounting and other records (including registers) of
the company, and is entitled to require from any officer of the
company and any auditor of a related company such information
and explanations as he desires for the purposes of audit.
(5) An auditor of a holding company for which consolidated
accounts are required has a right of access at all reasonable times
to the accounting and other records (including registers) of any
subsidiary, if necessary, and is entitled to require from any officer
or auditor of any subsidiary, at the expense of the holding company,
such information and explanations in relation to the affairs of the
subsidiary as he requires for the purpose of reporting on the
consolidated accounts.
(6) The auditor's report shall be attached to or endorsed on the
accounts or consolidated accounts and shall, if any member so
requires, be read before the company in general meeting and shall
be open to inspection by any member at any reasonable time.
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(7) An auditor of a company or his agent authorized by him in
writing for the purpose is entitled to attend any general meeting
o f the company and to receive all notices of, and other
communications relating to, any general meeting which a member
is entitled to receive, and to be heard at any general meeting which
he attends on any part of the business of the meeting which concerns
the auditor in his capacity as auditor.
(8) If an auditor, in the course of the performance of his duties
as auditor of a company, is satisfied that--
(a) there has been a breach or non-observance of any of the
provisions of this Act; and
(b) the circumstances are such that in his opinion the matter
has not been or will not be adequately dealt with by
comment in his report on the accounts or consolidated
accounts or by bringing the matter to the notice of the
directors of the company or, if the company is a subsidiary,
of the directors of its holding company,
he shall forthwith report the matter in writing to the Registrar.
Penalty: Imprisonment for two years or thirty thousand ringgit
or both.
(9) An officer of a corporation who refuses or fails without
lawful excuse to allow an auditor of the corporation or an auditor
of a corporation who refuses or fails without lawful excuse to
allow an auditor of its holding company access, in accordance with
this section, to any accounting and other records (including registers)
of the corporation in his custody or control, or to give any information
or explanation as and when required under this section, or otherwise
hinders, obstructs or delays an auditor in the performance of his
duties or the exercise of his powers, shall be guilty of an offence
against this Act.
Penalty: Imprisonment for two years or thirty thousand ringgit
or both.
Auditors and other persons to enjoy qualified privilege in certain
circumstances
174A. (1) An auditor shall not, in the absence of malice on his
part, be liable to any action for defamation at the suit of any person
in respect of any statement which he makes in the course of his
duties as auditor, whether the statement is made orally or in writing.
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(2) A person shall not, in the absence of malice on his part, be
liable to any action for defamation at the suit of any person in
respect of the publication of any document prepared by an auditor
in the course of his duties and required by or under this Act to be
lodged with the Registrar.
(3) This section does not limit or affect any other right, privilege
or immunity that an auditor or other person has as defendant in
an action for defamation.
Duties of auditors to trustee for debenture holders
175. (1) The auditor of a borrowing corporation shall within seven
days after furnishing the corporation with any balance sheet or
profit and loss account or any report certificate or other document
which he is required by this Act or by the debentures or trust deed
to give to the corporation, send by post to every trustee for the
holders of debentures of the borrowing corporation a copy thereof.
(2) Where in the performance of his duties as auditor of a
borrowing corporation the auditor becomes aware of any matter
which is in his opinion relevant to the exercise and performance
of the powers and duties imposed by this Act or by any trust deed
upon any trustee for the holders of debentures of the corporation
he shall, within seven days after so becoming aware of the matter,
send by post a report in writing on the matter to the borrowing
corporation and a copy thereof to the trustee.
Penalty: *One thousand ringgit. Default penalty.
PART VII
ARRANGEMENT AND RECONSTRUCTIONS
Power to compromise with creditors and members
176. (1) Where a compromise or arrangement is proposed between
a company and its creditors or any class of them or between the
company and its members or any class of them the Court may, on
the application in a summary way of the company or of any
creditor or member of the company, or in the case of a company
being wound up of the liquidator, order a meeting of the creditors
or class of creditors or of the members of the company or class
of members to be summoned in such manner as the Court directs.
*NOTE--Previously "two hundred and fifty ringgit"see Companies (Amendment) Act 1986 [Act A657].
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(2) A meeting held pursuant to an order of the Court made
under subsection (1) may be adjourned from time to time if the
resolution for adjournment is approved by a majority in number
representing three-fourths in value of the creditors or class of
creditors or members or class of members present and voting
either in person or by proxy at the meeting.
( 3 ) I f a majority in number representing three-fourths in
value of the creditors or class of creditors or members or class of
members present and voting either in person or by proxy at the
meeting or the adjourned meeting agrees to any compromise or
arrangement the compromise or arrangement shall, if approved
by order of the Court, be binding on all the creditors or class of
creditors or on the members or class of members, as the case
may be, and also on the company or, in the case of a company in
t h e course of being wound up, on the liquidator and
contributories of the company.
(4) The Court may grant its approval to a compromise or
arrangement subject to such alterations or conditions as it thinks
just.
(5) An order under subsection (3) shall have no effect until an
office copy of the order is lodged with the Registrar, and upon
being so lodged, the order shall take effect on and from the date
of lodgment or such earlier date as the Court may determine and
as may be specified in the order.
(6) Subject to subsection (7), a copy of every order made under
subsection (3) shall be annexed to every copy of the memorandum
of the company issued after the order has been made, or, in the
case of a company not having a memorandum, to every copy so
issued of the instrument constituting or defining the constitution
of the company.
(7) The Court may, by order, exempt a company from compliance
with the requirements of subsection (6) or determine the period
during which the company shall so comply.
(8) Where any such compromise or arrangement (whether or
not for the purposes of or in connection with a scheme for the
reconstruction of any company or companies or the amalgamation
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of any two or more companies) has been proposed, the directors
of the company shall--
(a) if a meeting of the members of the company by resolution
so directs, instruct such accountants or advocates or both
as are named in the resolution to report on the proposals
and forward their report to the directors as soon as may
be; and
(b) make the report available at the registered office of the
company for inspection by the shareholders and creditors
of the company at least seven days before the date of any
meeting ordered by the Court to be summoned as provided
in subsection (1).
(9) Every company which makes default in complying with
subsection (6) or (8) and every officer of the company who is in
default shall be guilty of an offence against this Act.
Penalty: *Two thousand ringgit.
Power of Court to restrain proceedings
(10) Where no order has been made or resolution passed for the
winding up of a company and any such compromise or arrangement
has been proposed between the company and its creditors or any
class of those creditors, the Court may. in addition to any of its
powers, on the application in a summary way of the company or
of any member or creditor of the company restrain further proceedings
in any action or proceeding against the company except by leave
of the Court and subject to such terms as the Court imposes.
(10A) The Court may grant a restraining order under subsection
(10) to a company for a period of not more than ninety days or
such longer period as the Court may for good reason allow if and
only if--
(a) it is satisfied that there is a proposal for a scheme of
compromise or arrangement between the company and
its creditors or any class of creditors representing at least
one-half in value of all the creditors;
(b) the restraining order is necessary to enable the company
and its creditors to formalize the scheme of compromise
or arrangement for the approval of the creditors or members
pursuant to subsection (1);
*NOTE--Previously "five hundred ringgit"see Companies (Amendment) Act 1986 [Act A657].
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(c) a statement in the prescribed form as to the affairs of the
company made up to a date not more than three days
b e f o r e the application is lodged together with the
application; and
(d) it approves the person nominated by a majority of the
creditors in the application by the company under subsection
(10) to act as a director or if that person is not already
a director, notwithstanding the provisions of this Act or
the memorandum and articles of the company, appoints
the person to act as a director.
(10B) The person approved or appointed by the Court to act as
a director of the company under subsection (10A) shall have a right
of access at all reasonable times to the accounting and other records
(including registers) of the company, and is entitled to require
from any officer of the company such information and explanation
as he may require for the purposes of his duty.
(10C) Any disposition of the property of the company, including
things in action and any acquisition of property by the company,
other than those made in the ordinary course of business, made
after the grant of the restraining order by the Court shall, unless
the Court otherwise orders, be void.
(10D) Where a company disposes or acquires any property, other
than in the ordinary course of its business, without leave of the
Court, every officer of the company who is in default shall be
guilty of an offence against this Act.
Penalty: Imprisonment for five years or one million ringgit or
both.
(10E) Where an order is made under subsection (10), every
company in relation to which the order is made shall, within seven
days--
(a) lodge an office copy of the order with the Registrar; and
(b) publish a notice of the order in a daily newspaper circulating
generally throughout Malaysia,
and every company which makes default in complying with this
subsection and every officer of the company who is in default shall
be guilty of an offence against this Act.
Penalty: One hundred thousand ringgit.
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(10F) An order made by the Court under subsection (10) shall
not have the effect of restraining further proceedings in any action
or proceeding against any person other than the company that had
applied for the restraining order.
(10G) For the purpose of subsection (10F) , the term "any person"
includes a guarantor of the company.
Interpretation
(11) In this section--
"arrangement" includes a reorganization of the share capital of
a company by the consolidation of shares of different classes or
by the division of shares into shares of different classes or by both
these methods;
"company" means any corporation or society liable to be wound
up under this Act.
Information as to compromise with creditors and members
177. (1) Where a meeting is summoned under section 176 there
shall--
(a) with every notice summoning the meeting which is sent
to a creditor or member, be sent also a statement explaining
the effect of the compromise or arrangement and in
particular stating any material interests of the directors,
whether as directors or as members or as creditors of the
company or otherwise, and the effect thereon of the
compromise or arrangement so far as it is different from
the effect on the like interests of other persons; and
(b) in every notice summoning the meeting which is given
by advertisement, be included either such a statement or
a notification of the place at which and the manner in
which creditors or members entitled to attend the meeting
may obtain copies of such a statement.
(2) Where the compromise or arrangement affects the rights of
debenture holders, the statement shall give the like explanation
with respect to the trustee for the debenture holders as, under
subsection (1), a statement is required to give with respect to the
directors.
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(3) Where a notice given by advertisement includes a notification
that copies of such a statement can be obtained, every creditor or
member entitled to attend the meeting shall on making application
in the manner indicated by the notice be furnished by the company
free of charge with a copy of the statement.
(4) Each director and each trustee for debenture holders shall
give notice to the company of such matters relating to himself as
may be necessary for the purposes of this section within seven
days of the receipt of a request in writing for information as to
those matters.
(5) Where default is made in complying with any requirement
of this section, the company and every officer of the company who
is in default shall be guilty of an offence against this Act.
Penalty: Imprisonment for *three years or ten thousand ringgit.
(6) For the purpose of subsection (5) the liquidator of the company
and any trustee for debenture holders shall be deemed to be an
officer of the company.
(7) Notwithstanding subsection (5) a person shall not be liable
under that subsection if he shows that the default was due to
the refusal of any other person, being a director or trustee for
debenture holders, to supply the necessary particulars as to his
interests.
Provisions for facilitating reconstruction and amalgamation of
companies
178. (1) Where an application is made to the Court under this
Part for the approval of a compromise or arrangement and it is
shown to the Court that the compromise or arrangement has been
proposed for the purposes of or in connection with scheme for the
reconstruction of any company or the amalgamation of any two
or more companies and that under the scheme the whole or any
part of the undertaking or the property of any company concerned
in the scheme (in this section referred to as the "transferor company")
is to be transferred to another company (in this section referred
to as the "transferee company"), the Court may either by the order
approving the compromise or arrangement or by any subsequent
order provide for all or any of the following matters:
(a) the transfer to the transferee company of the whole or
any part of the undertaking and of the property or liabilities
of the transferor company;
*NOTE--Previously "one year or two thousand five hundred ringgit"see Companies (Amendment) Act
1986 [Act A657].
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(b) the allotting or appropriation by the transferee company
of any shares, debentures, policies or other like interests
i n that company which under the compromise or
arrangement are to be allotted or appropriated by that
company to or for any person;
(c) the continuation by or against the transferee company of
any legal proceedings pending by or against the transferor
company;
(d) the dissolution, without winding up, of the transferor
company;
(e) the provision to be made for any persons who, within
such time and in such manner as the Court directs, dissent
from the compromise or arrangement; and
(f) such incidental, consequential and supplemental matters
as are necessary to secure that the reconstruction or
amalgamation shall be fully and effectively carried out.
(2) Where an order made under this section provides for the
transfer of property or liabilities, then by virtue of the order that
property shall be transferred to and vest in, and those liabilities
shall be transferred to and become the liabilities of, the transferee
company, free in the case of any particular property if the order
so directs, from any change which is by virtue of the compromise
or arrangement to cease to have effect.
(3) Where an order is made under this section every company
in relation to which the order is made shall lodge within seven
days of the making of the order--
(a) an office copy of the order with the Registrar; and
(b) where the order relates to land, an office copy of the
order with the appropriate authority concerned with the
registration or recording of dealings in that land,
and every company which makes default in complying with this
section and every officer of the company who is in default shall
be guilty of an offence against this Act.
Penalty: *Two thousand ringgit. Default penalty.
(4) No vesting order referred to in this section shall have any
effect or operation in transferring or otherwise vesting land until
the appropriate entries are made with respect to the vesting of that
land by the appropriate authority.
*NOTE--Previously "Five hundred ringgit"see Companies (Amendment) Act 1986 [Act A657].
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(5) In this section--
"liabilities" includes duties;
"property" includes property rights and powers of every description.
( 6 ) N o t w i t h s t a n d i n g the provisions of subsection 176(11)
"company" in this section does not include any company other
than a company as defined in section 4.
(Deleted by Act 498).
179.
Power to acquire shares of shareholders dissenting from scheme
or contract approved by majority
180. (1) Where a scheme or contract involving the transfer of all
of the shares or all of the shares in any particular class in a
company (in this section referred to as the "transferor company")
to another company or corporation (in this section referred to as
the "transferee company") has within four months after the making
of the offer in that behalf by the transferee company been approved
as to the shares or as to each class of shares whose transfer is
involved by the holders of not less than nine-tenths in nominal
value of those shares or of the shares of that class (other than
shares already held at the date of the offer by, or by a nominee
for, the transferee company or its subsidiary), the transferee company
may at any time within two months after the offer has been so
approved give notice in the prescribed manner to any dissenting
shareholder that it desires to acquire his shares and when such a
notice is given the transferee company shall, unless on an application
made by the dissenting shareholder within one month from the
date on which the notice was given or within seven days of a
statement being supplied to a dissenting shareholder pursuant to
subsection (2) (whichever is the later) the Court thinks fit to order
otherwise, be entitled and bound to acquire those shares on the
terms which, under the scheme or contract the shares of the approving
shareholders are to be transferred to the transferee company or if
the offer contained two or more alternative sets of terms upon the
terms which were specified in the offer as being applicable to
dissenting shareholders.
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(2) Where a transferee company has given notice to any dissenting
shareholder that it desires to acquire his shares the dissenting
shareholder shall be entitled to require the company by a demand
in writing served on that company within one month from the date
on which the notice was given to supply him with a statement in
writing of the names and addresses of all other dissenting shareholders
as shown in the register of members and the transferee company
shall not be entitled or bound to acquire the share of the dissenting
shareholders until fourteen days after the posting of the statement
of those names and addresses to the dissenting shareholder.
(3) Where in pursuance of any such scheme or contract, shares
in a company are transferred to another company or its nominee
and those shares together with any other shares in the first-mentioned
company held by, or by a nominee for, the transferee company or
its subsidiary at the date of the transfer comprise or include nine-
tenths in nominal value of the shares in the first-mentioned company
or of any class of those shares, then--
(a) the transferee company shall within one month from the
date of the transfer (unless on a previous transfer in
pursuance of the scheme or contract it has already complied
with this requirement) give notice of that fact in the
prescribed manner to the holders of the remaining shares
or of the remaining shares of that class who have not
assented to the scheme or contract; and
(b) any such holder may within three months from the giving
of the notice to him require the transferee company to
acquire the shares in question,
and where a shareholder gives notice under paragraph (b) with
respect to any shares, the transferee company shall be entitled and
bound to acquire those shares on the terms on which under the
scheme or contract the shares of the approving shareholders were
transferred to it, or on such other terms as are agreed or as the
Court on the application of either the transferee company or the
shareholder thinks fit to order.
(4) Where a notice has been given by the transferee company
under subsection (1) and the Court has not, on an application made
by the dissenting shareholder, ordered to the contrary, the transferee
company shall, after the expiration of one month after the date on
which the notice has been given or, after fourteen days after a
statement has been supplied to a dissenting shareholder pursuant
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to subsection (2) or if an application to the Court by the dissenting
shareholder is then pending, after that application has been disposed
of, transmit a copy of the notice to the transferor company together
with an instrument of transfer executed, on behalf of the shareholder
by any person appointed by the transferee company, and on its
own behalf by the transferee company, and pay, allot or transfer
to the transferor company the amount or other consideration
representing the price payable by the transferee company for the
shares which by virtue of this section that company is entitled to
acquire, and the transferor company shall thereupon register the
transferee company as the holder of those shares.
(5) Any sums received by the transferor company under this
section shall be paid into a separate bank account, and any such
sums and any other consideration so received shall be held by that
company in trust for the several persons entitled to the shares in
respect of which they were respectively received.
(6) Where any consideration other than cash is held in trust by
a company for any person under this section or under any
corresponding previous enactment, it may, after the expiration of
two years and shall before the expiration of ten years from the date
on which the consideration was allotted or transferred to it, transfer
the same to the Minister charged with the responsibility for finance.
(7) The Minister charged with the responsibility for finance
shall sell or dispose of any consideration so received in such
manner as the thinks fit and shall deal with the proceeds of the
sale or disposal as if it were moneys paid to him pursuant to the
law relating to unclaimed moneys.
(8) In this section "dissenting shareholder" includes a shareholder
who has not assented to the scheme or contract and any shareholder
who failed or refused to transfer his shares to the transferee company
in accordance with the scheme or contract.
Remedy in cases of an oppression
181. (1) Any member or holder of a debenture of a company or,
in the case of a declared company under Part IX, the Minister, may
apply to the Court for an order under this section on the ground--
(a) that the affairs of the company are being conducted or
the powers of the directors are being exercised in a manner
oppressive to one or more of the members or holders of
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debentures including himself or in disregard of his or
their interests as members, shareholders or holders of
debentures of the company; or
(b) that some act of the company has been done or is threatened
or that some resolution of the members, holders of
debentures or any class of them has been passed or is
proposed which unfairly discriminates against or is
otherwise prejudicial to one or more of the members or
holders of debentures (including himself).
(2) If on such application the Court is of the opinion that either
of those grounds is established the Court may, with the view to
bringing to an end or remedying the matters complained of, make
such order as it thinks fit and without prejudice to the generality
of the foregoing the order may--
(a) direct or prohibit any act or cancel or vary any transaction
or resolution;
(b) regulate the conduct of the affairs of the company in
future;
(c) provide for the purchase of the shares or debentures of
the company by other members or holders of debentures
of the company or by the company itself;
(d) in the case of a purchase of shares by the company provide
for a reduction accordingly of the company's capital; or
(e) provide that the company be wound up.
(3) Where an order that the company be wound up is made
pursuant to paragraph (2)(e) the provisions of this Act relating to
winding up of a company shall, with such adaptations as are
necessary, apply as if the order had been made upon a petition duly
presented to the Court by the company.
(4) Where an order under this section makes any alteration in
or addition to any company's memorandum or articles, then,
notwithstanding anything in any other provision of this Act, but
subject to the order, the company concerned shall not have power
without the leave of the Court to make any further alteration in
or addition to the memorandum or articles inconsistent with the
order; but subject to the foregoing provisions of this subsection
the alterations or additions made by the order shall be of the same
effect as if duly made by resolution of the company.
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(5) An office copy of any order made under this section shall
be lodged by the applicant with the Registrar within fourteen days
after the making of the order.
Penalty: *One thousand ringgit. Default penalty.
PART VIII
RECEIVERS AND MANAGERS
Disqualification for appointment as receiver
182. (1) The following shall not be qualified to be appointed and
shall not act as receiver of the property of a company:
(a) a corporation;
(b) an undischarged bankrupt;
(c) a mortgagee of any property of the company, an auditor
of the company or an officer of the company or of any
corporation which is a mortgagee of the property of the
company; and
(d) any person who is not an approved liquidator or the
Official Receiver.
(2) Nothing in paragraph (1)(a) or (d) shall apply to any corporation
authorized by any written law to act as receiver of the property
of a company.
(3) Nothing in this section shall disqualify a person from acting
as receiver of the property of a company if acting under an
appointment validly made before the commencement of this Act.
Liability of receiver
183. (1) Any receiver or other authorized person entering into
possession of any assets of a company for the purpose of enforcing
any charge shall, notwithstanding any agreement to the contrary,
but without prejudice to his rights against the company or any
other person, be liable for debts incurred by him in the course of
the receivership or possession, for services rendered, goods purchased
or property hired, leased, used or occupied.
*NOTE--Previously "two hundred and fifty ringgit"see Companies (Amendment) Act 1986 [Act A657].
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(2) Subsection (1) shall not be so construed as to constitute the
person entitled to the charge a mortgagee in possession.
Application for directions
(3) A receiver or manager of the property of a company may
apply to the Court for directions in relation to any matter arising
in connection with the performance of his functions.
(4) Where a receiver or manager has been appointed to enforce
any charge for the benefit of holders of debentures of the company
any such debenture holder may apply to the Court for directions
in relation to any matter arising in connection with the performance
of the functions of the receiver or manager.
Power of Court to fix remuneration of receivers or managers
184. (1) The Court may, on application by the liquidator of a
company, by order fix the amount to be paid by way of remuneration
to any person who, under the powers contained in any instrument,
has been appointed as receiver or manager of the property of the
company.
(2) The power of the Court shall, where no previous order has
been made with respect thereto--
(a) extend to fixing the remuneration for any period before
the making of the order or the application therefor;
(b) be exercisable notwithstanding that the receiver or manager
has died or ceased to act before the making of the order
or the application therefor; and
(c) where the receiver or manager has been paid or has retained
for his remuneration for any period before the making of
the order any amount in excess of that fixed for that
p e r i o d , extend to requiring him or his personal
representatives to account for the excess or such part
thereof as may be specified in the order.
(3) The power conferred by paragraph (2)(c) shall not be exercised
as respects any period before the making of the application for the
order unless in the opinion of the Court there are special circumstances
making it proper for the power to be so exercised.
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(4) The Court may from time to time, on an application made
either by the liquidator or by the receiver or manager, vary or
amend an order made under this section.
Appointment of liquidator as receiver
185.  Where an application is made to the Court to appoint a
receiver on behalf of the debenture holders or other creditors of
the company which is being wound up by the Court, the liquidator
may be so appointed.
Notification of appointment of receiver
186. (1) If any person obtains an order for the appointment of a
receiver or manager of the property of a company or of the property
within Malaysia of any other corporation, or appoints such a receiver
or manager under any powers contained in any instrument, he
shall, within seven days after he has obtained the order or made
the appointment, lodge notice of the fact with the Registrar.
(2) Where any person appointed receiver or manager of the
property of a company or other corporation under the powers
contained in any instrument ceases to act as such he shall, within
seven days thereafter lodge with the Registrar notice to that effect.
(3) Every person who makes default in complying with the
requirements of this section shall be guilty of an offence against
this Act.
Penalty : *One thousand ringgit. Default penalty.
Statement that receiver appointed
187. (1) Where a receiver or manager of the property of a corporation
has been appointed, every invoice, order for goods or business
letter issued by or on behalf of the corporation or the receiver or
manager or the liquidator of the corporation, being a document on
or in which the name of the corporation appears, shall contain a
statement immediately following the name of the corporation that
a receiver or manager has been appointed.
*NOTE--Previously "two hundred and fifty ringgit"see Companies (Amendment) Act 1986 [Act A657].
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(2) If default is made in complying with this section the corporation
and every officer and every liquidator of the corporation and every
receiver or manager who knowingly and wilfully authorizes or
permits the default shall be guilty of an offence against this Act.
Provisions as to information where receiver or manager appointed
188. (1) Where a receiver or manager of the property of a company
(in this section and in section 189 called "the receiver"), is
appointed--
(a) the receiver shall forthwith send notice to the company
of his appointment;
(b) there shall, within fourteen days after receipt of the notice,
or such longer period as may be allowed by the Court or
by the receiver, be made out and submitted to the receiver
in accordance with section 189 a statement in the prescribed
form as to the affairs of the company; and
(c) the receiver shall within one month after receipt of the
statement--
(i) lodge with the Registrar, a copy of the statement
and of any comments he sees fit to make thereon;
(ii) send to the company, a copy of any such comments
as aforesaid, or if he does not see fit to make any
comment, a notice to that effect; and
(iii) where the receiver is appointed by or on behalf of
the holders of debentures of the company send to
the trustees, if any, for those holders, a copy of the
statement and his comments thereon.
(2) Subsection (1) shall not apply in relation to the appointment
of a receiver or manager to act with an existing receiver or manager
or in place of a receiver or manager dying or ceasing to act, except
that, where that subsection applies to a receiver or manager who
dies or ceases to act before that subsection has been fully complied
with, the references in paragraphs (b) and (c) thereof to the receiver
shall (subject to subsection (3)) include references to his successor
and to any continuing receiver or manager.
(3) Where the company is being wound up this section and
section 189 shall apply notwithstanding that the receiver or manager
and the liquidator are the same person, but with any necessary
modifications arising from that fact.
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(4) If any person makes default in complying with any of the
requirements of this section, he shall be guilty of an offence against
this Act.
Penalty: *Two thousand ringgit. Default penalty.
Special provisions as to statement submitted to receiver
189. (1) The statement as to the affairs of a company required by
section 188 to be submitted to the receiver shall show as at the
date of the receiver's appointment the particulars of the company's
assets, debts and liabilities, the names and addresses of its creditors,
the securities held by them respectively, the dates when the securities
were respectively given and such further or other information as
may be prescribed.
(2) The statement shall be submitted by, and be verified by
affidavit of, one or more of the persons who were at the date of
the receiver's appointment the directors of the company and by the
person who was at that date the secretary of the company, or by
such of the persons hereafter in this subsection mentioned as the
receiver may require to submit and verify the statement, that is to
say--
(a) persons who are or have been officers;
(b) persons who have taken part in the formation of the
company at any time within one year before the date of
the receiver's appointment;
(c) persons who are in the employment of the company, or
have been in the employment of the company within that
year, and are in the opinion of the receiver capable of
giving the information required;
(d) persons who are or have been within that year officers
of or in the employment of a corporation which is, or
within that year was, an officer of the company to which
the statement relates.
(3) Any person making the statement and affidavit shall be
allowed and shall be paid by the receiver (or his successor) out
of his receipts, such costs and expenses incurred in and about the
preparation and making of the statement and affidavit as the receiver
(or his successor) may consider reasonable, subject to an appeal
to the Court.
*NOTE--Previously "Five hundred ringgit"see Companies (Amendment) Act 1986 [Act A657].
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(4) If any person makes default in complying with the requirements
of this section, he shall be guilty of an offence against this Act.
Penalty: *One thousand ringgit. Default penalty.
(5) References in this section to the receiver's successor shall
include a continuing receiver or manager.
Lodging of accounts of receivers and managers
190. (1) Every receiver or manager of the property of a company
or of the property within Malaysia of any other corporation shall--
(a) within one month after the expiration of the period of six
months from the date of his appointment and of every
subsequent period of six months and within one month
after he ceases to act as receiver or manager, lodge with
the Registrar a detailed account in the prescribed form
showing--
(i) his receipts and his payments during each period
of six months, or, where he ceases to act as receiver
or manager, during the period from the end of the
period to which the last preceding account related
or from the date of his appointment, as the case
may be, up to the date of his so ceasing;
(ii) the aggregate amount of those receipts and payments
during all preceding periods since his appointment;
and
(iii) where he has been appointed pursuant to the powers
contained in any instrument, the amount owing under
that instrument at the time of his appointment, in
the case of the first account, and at the expiration
of every six months after his appointment and, where
he has ceased to act as receiver or manager at the
date of his so ceasing, and his estimate of the total
value of all assets of the company or other corporation
which are subject to that instrument; and
(b) before lodging the account, verify by affidavit all accounts
and statements referred to therein.
*NOTE--Previously "two hundred and fifty ringgit"see Companies (Amendment) Act 1986 [Act A657].
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(2) The Registrar may of his own motion or on the application
of the company or other corporation or a creditor cause the accounts
to be audited by an approved company auditor appointed by the
Registrar and for the purpose of the audit the receiver or manager
shall furnish the auditor with such vouchers and information as he
requires and the auditor may at any time require the production
of and inspect any books of account kept by the receiver or manager
or any document or other records relating thereto.
(3) Where the Registrar causes the accounts to be audited upon
the request of the company or other corporation or a creditor he
may require the applicant to give security for the payment of the
cost of the audit.
(4) The costs of an audit under subsection (2) shall be fixed by
the Registrar and be paid by the Receiver unless the Registrar
otherwise determines.
(5) Every receiver or manager who makes default in complying
with this section shall be guilty of an offence against this Act.
Penalty: *One thousand ringgit. Default penalty.
Payments of certain debts out of assets subject to floating
charge in priority to claims under charge
191. (1) Where a receiver is appointed on behalf of the holders
of any debentures of a company secured by a floating charge or
possession is taken by or on behalf of debenture holders of any
property comprised in or subject to a floating charge, then if the
company is not at the time in the course of being wound up, debts
which in every winding-up are preferential debts and are due by
way of wages, salary, vacation leave or superannuation or provident
fund payments and any amount which in a winding up is payable
in pursuance of subsection 292(3) or (5) shall be paid out of any
assets coming to the hands of the receiver or other person taking
possession in priority to any claim for principal or interest in
respect of the debentures and shall be paid in the same order of
priority as is prescribed by that section in respect of those debts
and amounts.
(2) For the purposes of subsection (1) the references in paragraphs
292(1)(b), (c), (d) and (e) to the commencement of the winding
up shall be read as a reference to the date of the appointment of
the receiver or of possession being taken as aforesaid (as the case
requires).
*NOTE--Previously "two hundred and fifty ringgit"see Companies (Amendment) Act 1986 [Act A657].
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(3) Any payments made under this section shall be recouped as
far as may be out of the assets of the company available for
payment of general creditors.
Enforcement of duty of receiver, etc., to make returns
192. (1) If any receiver or manager of the property of a company
who has made default in making or lodging any return, account
or other document or in giving any notice required by law fails
to make good the default within fourteen days after the service on
him by any member or creditor of the company or trustee for
debenture holders of a notice requiring him to do so the Court
may, on an application made for the purpose by the person who
has given the notice, make an order directing him to make good
the default within such time as is specified in the order.
(2) If it appears that any receiver or manager of the property
of a company has misapplied or retained or become liable or
accountable for any money or property of the company or being
guilty of any misfeasance or breach of trust or duty in relation to
the company, the Court may, on the application of any creditor or
contributory or of the liquidator, examine into the conduct of the
receiver or manager and compel him to repay or restore the money
or property or any part thereof with interest at such rate as the
Court thinks just or to contribute such sum to the assets of the
company by way of compensation in respect of the misapplication,
retainer, misfeasance or breach of trust or duty as the Court thinks
just.
(3) This section shall have effect notwithstanding that the offence
is one for which the offender is criminally liable.
PART IX
INVESTIGATIONS
Application of Part
193. This Part does not authorize any investigation into the insurance
business of a company or into the business of a banking corporation
unless specifically provided for in this Part.
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Interpretation
In this Part, unless the contrary intention appears--
194.
"affairs", in relation to a company, includes--
(a) the promotion, formation, membership, control, trading,
dealings, business and property of the company;
(b) the ownership of shares in, debentures of and interests
issued by, the company;
(c) the ascertainment of the persons who are or have been
financially interested in the success or failure or apparent
success or failure of the company or are or have been
able to control or materially to influence the policy of the
company; and
(d) the circumstances under which a person acquired or
disposed of or become entitled to acquire or dispose of
shares in, debentures of or interests issued by the company;
"company" includes a foreign company which is a declared
company;
"declared company" means a company or foreign company which
the Minister has by order declared to be a company to which this
Part applies;
"officer or agent" in relation to a corporation, includes--
(a) a director, banker, advocate or auditor of the corporation;
(b) a person who at any time--
(i) has been a person referred to in paragraph (a); or
(ii) has been otherwise employed or appointed by the
corporation;
(c) a person who--
(i) has in his possession any property of the corporation;
(ii) is indebted to the corporation; or
(iii) is capable of giving information concerning the
promotion, formation, trading, dealings, affairs or
property of the corporation; and
(d) where there are reasonable grounds for suspecting or
believing that a person is a person referred to in paragraph
(c)--that person.
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Power to declare company or foreign company
195.  The Minister may by order declare that a company or foreign
company is a company to which this Part applies if he is satisfied--
(a) that a prima facie case has been established that, for the
protection of the public, the holders of interests to which
Division 5 of Part IV applies or the shareholders or creditors
of the company or foreign company, it is desirable that
the affairs of the company or foreign company should be
investigated under this Part;
(b) that it is in the public interest that allegations of fraud,
misfeasance or other misconduct by persons who are or
have been concerned with the formation or management
of the company or foreign company should be investigated
under this Part;
(c) that for any other reason it is in the public interest that
the affairs of the company or foreign company should be
investigated under this Part; or
(d) in the case of a foreign company, that the appropriate
authority of another country has requested that a declaration
be made pursuant to this section in respect of the company.
Appointment of inspectors for declared companies
196. (1) Where a company or foreign company has been declared
to be a company to which this Part applies, the Minister shall
appoint one or more inspectors to investigate the affairs of that
company, and to report his opinion thereon to the Minister.
(2) The expenses of and incidental to an investigation of a
declared company shall be defrayed in the first instance out of
moneys provided by Parliament.
(3) Where the Minister is of the opinion that the whole or any
part of the expenses of and incidental to the investigation should
be paid by the company or by any person who requested the
appointment of the inspector the Minister may by notice published
in the Gazette direct that the expenses be so paid.
(4) A notice under subsection (3) may specify the time and the
manner in which the payment of the expenses shall be made.
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ACT 125
(5) Where a notice has been published by the Minister under
subsection (4) the persons named in the notice to the extent therein
specified shall be liable to reimburse the Minister in respect of
those expenses.
(6) Action to recover any such expenses may be taken in the
name of the Government of Malaysia in any court of competent
jurisdiction.
(7) Where a notice under subsection (3) has been published for
the payment of the whole or part of the expenses by a company
and the company is in liquidation or subsequently goes into liquidation
the expenses so ordered to be paid by the company shall be deemed
to be part of the costs and expenses of the winding up for the
purposes of paragraph 292(1)(a).
(8) The report of the inspector may if he thinks fit, and shall,
if the Minister so directs, include a recommendation as to the
terms of the notice which he thinks proper in the light of his
investigation to be given by the Minister under subsection (3).
Investigation of affairs of company by inspectors at direction
of Minister
197. (1) The Minister may appoint one or more inspectors to
investigate the affairs of a company or such aspects of the
a f f a i r s of a company as are specified in the instrument of
appointment and to report thereon in such manner as the Minister
directs--
(a) in the case of a company having a share capital, on the
application of--
(i) not less than two hundred members or of members
holding not less than one-tenth of the shares issued;
or
(ii) holders of debentures holding not less than one-
fifth in nominal value of debentures issued; or
(b) in the case of a company not having a share capital, on
the application of not less than one-fifth in number of the
persons on the company's register of members.