The Companies Act 1994

(Amendment Up to 2019)

By
Company Secretariat

United Commercial Bank Limited

 The Companies Act 1994

PART-I

PRELIMINARY

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 The Companies Act 1994

1. Short title and commencement

(1) This Act may be called the Companies Act, 1994.

(2) It shall come into force on such rate as the Government may, by notification in
the Official, Gazette, appoint.

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 The Companies Act 1994

2. Definitions
(1) In this Act, unless there is anything repugnant in the subject or context,-
(a) "articles" means the articles of association of a company including, so far as they apply to the company, the regulations
contained in Schedule I to this Act. :
Provided that the article of association of a company framed under any law relating to companies at any time in force before the
commencement of this Act shall, so far as they are not inconsistent with the provisions of this Act, be deemed to be the articles
of association of that company framed in accordance with the provisions of the Act:
(b) "banking company" means a bank company as defined in section 5(9) of the Act, 1991 (Act No. 14 of 1991).
(c) "company" means a company formed and registered under this Act or an existing company;
(d) "The Court" means the Court having jurisdiction under this Act;
(e) "debenture" includes debenture stock, bonds and any other securities of a company, whether constituting a charge on the assets
of company or not;
(f) "director" includes any person occupying the position of director by whatever name called;
(g) "District Court" means the principle Civil Court of original jurisdiction in a district, but does not include the High Court
Division, in the exercise of its ordinary civil jurisdiction;
(h) "existing company" means a company formed and registered under any law relating to companies in force at any time before the
commencement of this Act, and is in operation after commencement of this Act,
(i) "financial year" means, in relation to any body corporate, the period in respect of which any profit and loss account of the body
corporate laid before it in annual general meeting is made up, whether that period is a year or not;
Provided that in relation to an insurance company, "financial year" shall mean the calendar year;
(j) "insurance company" means a company that carries on the business of insurance either solely or in common. with any other
business or businesses;

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 The Companies Act 1994

2. Definitions
(k) "manager" means an individual who, subject to the superintendence, control and direction of the Board of Directors, has the
management of the whole, or substantially the whole, of the affairs and business of a company , and includes a director or any
other person occupying the position of a manager, by whatever name called, and whether under a contract of service or not;
(l) "managing agent' means a person, firm or company by whatever name called, who or which is entitled to the management of the
whole affairs and business of a company by virtue of an agreement with the company, and under the control and direction of the
directors except to the extent, if any, otherwise provided for in the agreement;
(m) "managing director" means a director who, by virtue of an agreement with the company or of a resolution passed by the
company in its general meeting or by its directors or by virtue of its memorandum or articles of association, is entrusted with the
substantial powers of management which would not otherwise be exercisable by him and includes a director occupying the
position of a managing director by whatever name called;
Provided that the powers to do administrative acts of a routine nature when so authorised by the directors such as the power to
affix common seal of the company to any document or to draw and endorse any cheque on the account of the company in any
bank or to draw and endorsed negotiable instrument or to sign any certificate of share or to direct registration of transfer of any
shares shall not be deemed to be included within the substantial powers of management:
Provided further that a managing director of a company shall exercise his powers subject to the superintendent control and
direction of the directors.
(n) "memorandum" means the memorandum of association of a company as originally framed or as altered in pursuance of the
provisions of this Act;
(o) "officer" means a director, managing agent, manager secretary or any other officer of a company and also includes--
(i) where the managing agent is a firm any partner in the firm;
(ii) where the managing agent is a body corporate, any director or manager of the body corporate;

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 The Companies Act 1994

2. Definitions
(iii) where the secretary is a body corporate;
Provided that. except for the purpose of sections 331, 332, and 333, the form "officer" shall not include an auditor.;
(p) "prescribed" means as respects the provisions of this Act relating to the winding up of companies, prescribed by rules made by
the Supreme Court and, as respect the other provisions of this Act, prescribed by the Government;
(q) "private company" means a company which by its articles--
(i) restricts the right to transfer its shares, if any;
(ii) prohibits any invitation to the public to subscribe for its shares or debenture, if any;
(iii) limits the number of its members to fifty not including persons who are in its employment;
Provided that where two or more persons hold one or more shares in a company jointly, the shall, for the purposes of this
definitation be treated as a single member;
(r) "public company" means a company incorporated under this Act or under any law at any time in force before the
commencement of this Act and which is not a private company;
(s) "Registrar" means a Registrar or any other officer, by whatever designation, performing under this Act the duty of registration of
companies;
(f) "Schedule" means a schedule to this act;
(u) "secretary" means any individual possessing the prescribed qualifications appointed to perform the duties which may be
performed by a secretary under this Act and any other ministerial or administrative duties, and
(v) "share" means a share in the capital of the company, and includes stock except when a distinction between stock and shares is
expressed or implied.

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 The Companies Act 1994

2. Definitions
(2) For the purposes of this Act, a company shall subject to the provisions sub-section (4), be deemed to be a subsidiary of another, if--
(a) that other contrats the composition of Board of Directors of the first mentioned company.
(b) the first mentioned company, being an existing company, has before the commencement of this Act, issued preference shares the
holders of which have the same voting right in all respects as the holders of equity shares and that other company exercises or
controls more than half of the total voting power of the first mentioned company; or
(c) the first mentioned company is not a subsidiary within the meaning of clause (b), but that other company holds more than half in
nominal value of its equity share_capital; or
(d) the first mentioned company is a subsidiary of a third company with is that other's subsidiary.

(3) For the purposes of sub-section (2), the composition of a company's Board of Directors shall be deemed to be controlled by another
company if, that other company, by the exercise of some power exercisable by it at its discretion without the consent or concurrence
of any other person, can appoint or remove the holders of all or a majority of the directors, and for the purposes of this sub-section
that other company shall be deemed to have power to appoint to a directorship with respect to which any of the following conditions
is satisfied, that is to say--
(a) that power of appointment cannot be exercised except in favour of an individual,
(b)) that an individuals appointment thereto follows necessarily from his appointment as director, managing agent, secretary or
manager of or to any other office of employment in, that other company; or
(c) that the directorship is held by an individual nominated by that other company or a subsidiary thereof.

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2. Definitions
(4) In determining whether one company is a subsidiary of another the following conditions shall be applicable namely:--
(a) any shares held or power exercisable by that other company in a fiduciary capacity shall be treated as not held or exercisable by
it.
(b) subject to the provisions of clauses (c) and (d) any shares held or power exercisable shall be deemed to be the shares held or
power exercisable by that other company, if--
(i) the shares are held or the power is exercisable by a person as a nominee and on behalf of that other company, but this
clause shall not apply to the holding of such shares or to the exercise of such powers by such person where that other
company is concerned in a fiduciary capacity.
(ii) the shares are held or the power is exercisable by a subsidiary of that other company or by a nominee of such subsidiary,
but this clause shall not apply to the holding of such shares or to the exercise of such powers by the subsidiary or by its
nominee where the subsidiary is concerned in a fiduciary capacity;
(c) any shares held or power exercisable by any person by virtue of the provisions of any debentures of the first-mentioned
company or of a trust deed for securing any issue of such debentures shall disregarded;
(d) if any shares are held or power is exercisable, not being held of exercisable as mentioned in clause (c),--
(i) by that other company or by its subsidiary or by a nominee of that other or its subsidiary as the case may be, and
(ii) the ordinary business of that other company or as the case may be of its subsidiary includes the lending of money and such
shares are held or the power is exercisable by way of security of the loan [then such power shall not be treated as being
held or exercisable by such company or its nominee.]

(5) For the purposes of this Act' a company shall be deemed to be the holding company of another if, and only if, that other is its
subsidiary.

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 The Companies Act 1994

3. Jurisdiction of the Court.

(1) The Court having jurisdiction under this Act shall be High Court Division;
Provided that the Government may be notification in the Official Gazette and subject to such
restrictions and conditions as it thinks fit, empower any District Court to exercise all or any of the
jurisdiction by this Act conferred upon the Court, and in that case such District Court shall as
regards the jurisdiction so conferred, be the Court in respect of all companies having their registered
office in the district.

Explanation.--For the purposes to wind up companies the expression "registered office" means the
place where the registered office of the company, during the six months immediately preceding the
presentation of the petition of winding up was situated.

(2) Nothing in this section shall invalidate a proceeding by reason of its being taken in a wrong Court

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PART-II

CONSTITUTION AND
INCORPORATION

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4. Prohibition of partnership exceeding certain number:

(1) Nor company, association or partnership consisting of more than ten persons shall be formed or a
the purpose of carrying on the business of banking unless it is registered as a company under this
Act or is formed by or under any other Act of Parliament.
(2) No company association or partnership consisting of more than twenty persons shall be formed for
the purpose of carrying on any other business that has for its objects the acquisition of gain by the
company, association or partnership, or by the individual members thereof unless it is registered as a
company under this Act or is formed by or under any other Act of Parliament.
(3) This section shall not apply to joint family carrying on joint family business or trade. Provided that
for the purposes of this section, in computing the number of persons of a partnership, association or
company comprising two or more joint families, minor members of such families shall be excluded.
(4) Every member of a company, association or partnership carrying on business in contravention of
this section shall be personally liable for all liabilities incurred in such business.
(5) Any person who is a member of a company, association or partnership formed in contravention of
this section shall be punishable with fine not exceeding five thousand taka.

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Memorandum of Association
5. Mode of forming incorporated company.
Any seven or more persons or, where the company to be formed will be a private company, any two or
more persons associated for any lawful purpose may, be subscribing their names to a memorandum of
association and otherwise with the requirements of this Act in respect or registration form an
incorporated company, with or without limited liability, that is to say, either--
(a) a company limited by shares, that is to say, a company having the liability of its member limited by
the memorandum to the amount, if any, unpaid on the shares respectively held by them; or
(b) a company limited by guarantee, that is to say, a company having the liability of its members limited
by the memorandum to such amount as the members may respectively thereby undertake to
contribute to the assets of the assets of the company on the event of its being wound up; or
(c) an unlimited company, that is to say, a company having no limit on the liability of its members.

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6. Memorandum of company limited by shares.

In the case of a company limited by shares.-
(a) the memorandum shall state.--
(i) The name of the company, with "limited" as the last word in its name;
(ii) The address of the registered office;
(iii) The objects of the company, and, except in the case of trading companies, the territories to
which they extend;
(iv) That the liability of the members is limited;
(v) The amount of share capital with which the company proposes to be registered, and the
divisions thereof into shares of a fixed amount;
(b) each subscriber of the memorandum shall take at least one share;
(c) each subscriber shall write opposite to his name the number of shares he takes.

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7. Memorandum of company limited by guarantee.

In the case of a company limited by guarantee--
(a) the memorandum shall state--
(i) the name of the company, with "limited" as the last word in its name.
(ii) the address of the registered office;
(iii) the objects of the company, and, except in the case of trading companies, the territories to which they
extend;
(iv) that the liability of the members is limited;
(v) that each member undertakes to contribute to the assets of the company in the event of its being
wound up while he is a member or within one year afterwards, for payment of the debts and liabilities
of the company contracted before he ceases to be a member, ad of the charges and expenses of
winding up, and for adjustment of the right of the contributories among themselves, such amount as
may be required, not exceeding a specified amount;
(b) if the company has a share capital--
(i) the memorandum shall also state the amount of share capital with which the company proposes to be
registered and the division thereof into shares of a fixed amount;
(ii) each subscriber of the memorandum shall take at least one share;
(iii) each subscriber shall write opposite to his name the number of shares he takes.

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8. Memorandum of unlimited company.

In the case of an unlimited company
(a) the memorandum shall state-
(i) the name of the company;
(ii) the address of the registered office of the company;
(iii) the objects of the company and, except in the case of trading companies, the territories to
which they extend.
(b) if the company has a share capital-
(i) each subscriber of the memorandum shall take at least one share;
(ii) each subscriber shall write opposite to his name the number of shares he takes.

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9. Printing and signature of memorandum.

The memorandum of every company shall--
(a) be printed;
(b) be divided into paragraphs numbered consecutively; and
(c) be signed by each subscriber, who shall add his address and description in the presence of at least
two witnesses who shall attest the signature.

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10. Restriction on alteration of memorandum.

(1) A company shall not alter the conditions on continued in its memorandum except provisions is made
in the Act.
(2) Only those provisions which by any other specific provision contained in this Act, are required to be
stated in the memorandum of the company concerned shall be deemed to be the conditions
contained in its memorandum.
(3) Other provisions contained in the memorandum, including those relating to the appointment of
director, managing agent or manager may be altered in the same manner as the articles of the
company, but if there is any express provision in this Act permitting the alteration of such provisions
in any other manner, they may also be altered in such other manner.
(4) All reference to the articles of a company in this Act shall be construed as including references to
the other provisions contained in its memorandum as referred to in sub-section (3).

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11. Name of company and change of name.

(1) A company shall not be registered by a name identical with that by which a company in existence is already registered, or so nearly resembling
the name that there is likelihood of using the name to deceive, except where the company in existence is in the course of being dissolved and
signifies its written consent in such manner as the Registrar requires.
(2) If a company, through inadvertence or otherwise, is, without the consent referred to in sub-section (1), registered by a name identical with that by
which a company in existence is previously is registered, or so nearly resembling the name that there is likelihood of using the name to deceive,
the first mentioned company shall, on he direction of the Registrar, change its name within a period of one hundred and twenty days.
(3) If a company makes a default in complying with the direction made under sub-section (2), the company shall be punishable with fine of five
hundred take for every day during which the default continues and every officer who is in default shall be punishable with fine of one hundred
taka for every day during which the default continues.
(4) Except with the previous consent in writing of the Government, no company shall be registered by a name which is declared by the Government
by notification in the official Gazette, as undesirable: Provided that nothing in this sub-section shall apply to companies registered before the
commencement of this Act.
(5) No company shall be registered by a name containing in any form the name or any abbreviation of the name of the United Nations or of any
subsidiary body set up by the United Nations or of the World Health Organisation unless the company has obtained the previous authorisation in
writing of the Secretary General in the case of the United Nations or the subsidiary body as aforesaid or of the Director General of the World
Health Organisation in the case of that Organisation.
(6) Any company may, by special resolution and subject to the approval of the Registrar signified in writing, change it name.
(7) Were a company changes its name, the Registrar shall enter the new name on the register in place of the former name, and shall issued a
certificate of incorporation in its new name to meet the circumstances of the case and on the issue of such a certificate, the change of name shall
be complete.
(8) The change of name shall not change any rights or obligations of the company, or render defective any legal proceedings by or against the
company; and any legal proceedings that might have been continued or commenced against it by its former name may be continued or
commenced against it by its new name.
(9) A company may, on payment of such fee as may be prescribed, apply to the Registrar for information whether any company is registered or
proposed to be registered by a name specified in the application and the Registrar shall furnish the required information within a period of thirty
days from the date of receipt of the application.
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12. Alternation of memorandum.

(1) Subject to the provisions of this Act, a company may, by special resolution, alter the provisions of its
memorandum with respect to the objects of the company, so far as may be required to enable it--
(a) to carry on its business more economically or more efficiently; or
(b) to attain its main purpose by new or improved means; or
(c) to enlarge or change the local area of its operations; or
(d) to carry on some business which, under the existing circumstances. may conveniently or advantageously be
combined with the business of the company; or
(e) to restrict or abandon any of the objects specified in the memorandum; or
(f) to sell or dispose of the whole or any part of the undertaking of the company; or
(g) to amalgamate with any other company or body of persons.
(2) The alteration shall not take effect until and except in so far it is confirmed by the Court on petition.
(3) Before confirming the alteration, the Court must be satisfied--
(a) that sufficient notice has been given to every holder of debentures of the company, and to any person or class
of person whose interest will, in the option of the Court, be affected by the alteration; and
(b) that, with respect to every creditor who in the opinion of the Court is entitled to object, and who signifies his
objections in manner directed by the Court, either his consent to the alteration has been obtained or his debt
or claim has been discharged or has been determined, or has been secured to the satisfaction of the Court;
Provided that the Court may, in the cases of any person or class, for special reasons, dispense with the notice
required by this section.

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13. Power of Court when confirming alteration.

The Court may make an order confirming the alteration either wholly or in part,
and on such terms and conditions as it thinks fit, and may make such order as to
costs as it thinks proper.

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14. Exercises of discretion by Court.

The Court shall, in exercising its discretion under sections 12 and 13, have regard
to the class of them, as well as to the rights and interests of the creditors, and may
if it thinks fit, adjourn the proceedings in order that an arrangement may be made
to the satisfaction of the Court for the purchase of the interests of dissenting
members; and may give such directions and make such orders as it may think
expedient for facilitating or carrying into effect any such arrangement;

Provided that no part of the share capital of the company may be expended in any
such purchase.

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15. Procedure on confirmation of the alternation.

A certified copy of the order confirming the alternation, together with a printed
copy of the memorandum as altered, shall be filed by the company with the
Registrar within ninety days from the date of the order or within such time as may
be extended by the court, and he Registrar shall register the same. and shall certify
the registration under his hand, and the certificate shall be conclusive evidence that
all the requirements of this Act, with respect to the alteration and the confirmation
thereof, have been complied with, and hence forth the memorandum so altered
shall be the memorandum of the company.

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16. Effect of failure to register within extended time.

No such alteration shall have any operation until registration thereof has been duly
effected in accordance with the provisions of section 15, and if such registration is
not effected within the period specified in that section such alteration and the order
of the Court confirming the alteration, and all proceedings connected there with
shall, at the expiration of the period specified under that section become absolutely
null and void :

Provided that the Court may, on sufficient cause shown, revive the order on
application made within a further period of thirty days after the said period.

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Articles of Association
17. Registration of articles.
(1) A company limited by guarantee and an unlimited company shall, and a company limited by shares may. have an
articles of association herein provision shall be made for regulating the affairs of the company; and the article
shall be signed by the subscribers of the memorandum and be registered together with the memorandum.
(2) Articles of association may adopt all or any of the regulations contained in Schedule I, and shall in any event be
deemed to contain regulations identical with or to the same effect as regulation 56, 66, 71, 78, 79, 80, 81, 82, 95,
97, 105, 108, 112, 113, 114, 115, and 116 contained in that Schedule :
Provided that regulations 78, 79, 82, 81, and 82 shall not be deemed to be included in the articles of any private
company except a private company which is the subsidiary company of a public company :
Provided further that regulation, 108 shall be deemed to require that a statement of the reasons why of the whole
amount of any item of expenditure which may in fairness be distributed over several years, only a portion thereof
is charged against the income of the year, shall be shown in the profit and, loss account, unless the company in
general meeting shall determine otherwise.
(3) In the case of an unlimited company or a company limited by guarantee, the articles, if the company has a share
capital, shall state the amount of share capital with which the company proposes to be registered.
(4) In the case of an unlimited company or a company limited by guarantee, if the company has not a share capital,
the articles shall state the number of members with which the company proposes to the registered; and on the
basis of such number the Registrar shall determine the fees payable on registration.

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