Companies Act 2017 – ALL SECTIONS

TRUE or FALSE
Under the Companies Act, 2017, communications and notices to a company shall be addressed to its
registered office.
Answer: T
SECP constitutes one or more benches on a permanent basis, each known as a Company Bench, to
exercise jurisdiction under the Companies Act, 2017.
Answer: F
The definition of a "public company" is provided in Section 46 of the Companies Act, 2017.
Answer: F
The Companies Act, 2017 is an ordinance promulgated by the President of Pakistan.
Answer: F
The memorandum of association of an unlimited company must state the name of the company with the
word "Unlimited" as the last word of its name.
Answer: T
Two or more persons associated for any lawful purpose may form a public company.
Answer: F
As from the date of incorporation, a body corporate has perpetual succession under Section 18 of the
Companies Act, 2017.
Answer: T
Ghanimat Khan Enterprises (Pvt.) Limited ("GKE") was registered as a company under the Companies
Ordinance, 2016 on December 30, 2016. GKE is a "company" as defined in the Companies Act, 2017.
Answer: T
A person guilty of of an offence under Section 9 of the Companies Act, 2017 is liable to a penalty upto
Rs. 100 million.
Answer: F
Any provision in the memorandum of association of a company which is repugnant to the provisions of
the Companies Act, 2017 is void.
Answer: T

The definition of "prospectus" in the Companies Act, 2017 refers to the Securities and Exchange
Commission of Pakistan Act, 1997.
Answer: F
Preference shares and ordinary shares are exaxmples of different kinds of shares which a company's
memorandum and articles can provide for.
Answer: T
A share in a company is considered to be immovable property under the Companies Act, 2017.
Answer: F
Allotment of shares or debentures of a company must occur prior to publication of a prospectus for the
offering.
Answer: F
The Companies Act, 2017 favors the issuance of shares in book-entry form rather than physical form.
Answer: T
Section 76 was a new provision of the Companies Act, 2017, and the Companies Ordinance, 1984 did not
have a similar section.
Answer: T
A special resolution is required before a company can issue shares at a discount.
Answer: T
The Companies Act, 2017 prohibits banking companies from accepting deposits from the public.
Answer: F
The Companies Act, 2017 prohibits public companies from directly or indirectly providing financial
assistance for the purpose of purchasing debentures issued by the company.
Answer: F
A company limited by shares can reduce its share capital subject to confirmation by the Court.
Answer: T
For the purposes of the Companies Act, 2017, the term "charge" includes mortgages.
Answer: T
The Companies Act, 2017 defines a "mortgage or charge" as an instrument evidencing an issue of
securities based on interest.
Answer: F
Section 100 of the Companies Act, 2017 does not apply to a mortgage or charge on intellectual property.
Answer: F
The register of charges, kept with the registrar in respect of a given company, is open to inspection by any
member or creditor of that company without fee.
Answer: F
The particulars of every person interested in a mortgage or charge must be filed by that person with the
registrar within 30 days of the creation of the mortgage or charge.
Answer: F
SECP does not have the power to extend the time for filing the particulars required under Section 100 of
the Companies Act, 2017.
Answer: F
Section 109 of the Companies Ordinance, 1984 requires the company to give intimation to the registrar of
the payment or satisfaction of any mortgage or charge within 30 days.
Answer: T
Any violation of Section 100 of the Companies Act, 2017 is liable to a penalty of up to Rs. 250,000.
Answer: F
Any violation of Section 107 of the Companies Act, 2017 is punishable with imprisonment for a term
which may extend to one year.
Answer: F
A refusal of inspection pursuant to Section 112(2) of the Companies Act, 2017 can result in a penalty of
level 1 on the standards scale.
Answer: T
A company which fails to keep a register of its members is liable to a penalty of upto Rs. 500,000.
Answer: F
A company which fails to keep a register of its debenture-holders is liably to a penalty of upto Rs. 25,000.
Answer: T
A debenture-holder of a company is entitled to obtain a certified copy of its register of members from the
company without charge.
Answer: F
Someone who fraudulently omits the name of a person from a company's register of members can be
punished with imprisonment under the Companies Act, 2017.
Answer: T
Section 130 of the Companies Act, 2017 does not apply to a company not having a share capital.
Answer: F
Other than the annual general meeting referred to in Section 132 of the Companies Act, 2017, all general
meetings of a company are called statutory meetings.
Answer: F
If the chairman of a company's board of directors is present at the time appointed for holding a general
meeting of the company, and is willing to preside as chairman of the meeting, then he or she shall do so.
Answer: T
To appoint another person as a proxy to attend and vote at a meeting, a member of a company must lodge
the required form with the company at least 168 hours before the time for holding the meeting.
Answer: F
At a general meeting of ABC Textile Limited, the chairman makes a declaration at 10:21 a.m. that a
resolution has passed on a show of hands. Just before the adjournment of the meeting at 11:33 a.m., a
member demands that a poll be taken by secret ballot on the resolution. So long as the member has at
least one-tenth of the total voting power, the chairman must order the poll to be taken.
Answer: F
The members of a company are entitled to receive a certified copy of the minutes of any general meeting
of the company without charge.
Answer: F

MCQs
A company may alter the provisions of its memorandum of association by _______________ resolution.
Answer: Special
Which one of the following cannot be registered as a company under the Companies Act, 2017:
Answer: trust company
Which one of the following is not defined in Section 2 of the Companies Act, 2017?
Answer: Preference Share
Which of the following was involved in the enactment of the Companies Act, 2017?
Answer: National Assembly, Senate, President.
A/An _______________ company may be converted into a public company with the prior written
approval of SECP by passing a special resolution.
Answer: Private
Which of the following must occur before a private company starts its operations?

 every director of the company pays to the company the full amount on each of the shares taken or
contracted to be taken by the director in cash

 B. exercise of borrowing powers

 C. turnover
Answer: None of the above

Which one of the following does not need to be mentioned in the memorandum of association of a
company limited by shares?

Answer: the complete address of the company's registered office

Which one of the following is among the stated objectives of the Companies Act, 2017?
Answer: Protecting interest of creditors
Which one of the following steps occurs last in the formation of a company?
Answer: issuance of a certificate of incorporation
Which one of the following does not have jurisdiction under Section 5 of the Companies Act, 2017:
Answer: Karachi High Court
Companies issuing _______________ are required to enter into a trust deed in the form specified by
SECP.
Answer: Debentures
In case there are unsuccessful applications to subscribe for the shares of a company after an invitation to
the public, the company must _______________ the money.
Answer: Refund
A company which makes an allotment of its shares must file a _______________ of allotment within 45
days.
Answer: Return
Which of the followig is ordered in the correct order for an issue of shares?
Answer: prosectus, allotment, certificate
An application for registration of transfer of shares must be accompanied by a stamped and executed
_______________.
Answer: Instrument of transfer
The amount received by a company as a premium on the issue of its shares may be used for:

 A. issuing bonus shares

 B. paying preliminary expenses of the company

 C. redeeming preference shares

Answer: All of the above

If any part of the shares offered under Section 83 is declined or not subscribed, the shares can be allotted
as the company's _______________ deem(s) fit.
Answer: directors
To sub-divide its shares into shares of smaller amount, a company must:
Answer: alter its memorandum of association
A/An _______________ company may, subject to certain conditions, purchase its own shares.
Answer: listed
The shares purchased by a listed company under Section 88 must either be cancelled or held as
_______________ shares.
Answer: treasury
The requirement for filing the particulars of mortgages and charges does not apply to:
Answer: a negotiable instrument given to secure payment of a company's book debts
To comply with the requirements of Section 100 of the Companies Act, 2017, a company issuing a series
of debentures entitling debenture-holders to a charge pari passu must include the following in its filing:

 A. date of the resolutions authorizing issue of the debentures

 B. description of the charged property

 C. total amount secured

Answer: All of the above
The _______________ shall keep a register containing particulars of the charges registered in respect of
every company.
Answer: registrar
Section _____ of the Companies Act, 2017 requires that a chronological index of mortgages or charges be
kept.
Answer: 103
Where the registration required under Section 100 of the Companies Act, 2017 is effected by some person
other than _______________, that person shall be entitled to recover the amount of fees paid to the
registrar.
Answer: the company
The requirement for sending the registrar the particulars of modifications to a mortgage or charge must be
fulfilled within _____ days.
Answer: 30
A copy of every instrument creating a mortgage or charge must be kept at/in the:
Answer: registered office of the company
The _______________ may enter a memorandum of satisfaction of a charge notwithstanding that no
intimation has been received from the company.
Answer: registrar
Any _______________ of a company can inspect the register of charges maintained by the company
without fee.
Answer: creditor
Sub-section _____ of Section 112 of the Companies Act, 2017 appears to contain a typo.
Answer: 4
Which one of the following does not become a member of a company?
Answer: A subscriber to the memorandum of a company that has not yet been registered under Section 16
of the Companies Act, 2017
Every company is required to keep a register of _______________.

 A. debenture-holders

 B. members

 C. transfer of shares

Answer: all of the above

A request to inspect an index of the names of the members of a company must contain the following
information:

Answer: the purpose for which the information is to be used

The registers referred to in Sections 119 and 122 of the Companies Act, 2017 shall be _______________
evidence of any matter which is directed or authorized to be inserted therein.

Answer: prima facie

Every private company must hold a/an _______________ once in every calendar year.

Answer: annual general meeting

Notice of an extraordinary general meeting shall be given to:

 A. every director of the company

 B. every member of the company

 C. the auditors of the company

Answer: all of the above

A member of a company may appoint another person as _______________ to attend and vote at a
meeting of the company.

Answer: proxy

A resolution can be passed at a general meeting through a:

 A. poll

 B. secret ballot

 C. show of hands

Answer: all of the above

Every special resolution passed by a company shall be filed with the registrar within ___ days.

Answer: 15

Not less than ___ hours per day must be allowed for inspection by members of the books containing
minutes of proceedings of a company's general meetings.

Answer: 2