SECP Close Down Procedures Against Nazir Cotton Mills Limitted

On grounds that it took the required measures to revive the operations, the Securities and Exchange Commission of Pakistan (SECP) closed the proceedings against the Nazir Cotton Mill Limited.

Following the six years in its decision, the adjudication department of SECP declared that its main business line had shifted from textile to the establishment and operation, by the shareholders in the extraordinary general Meeting held on 16 May 2020, of cattle rearers, sheep farmers and poultry.

In its three months of financial statements ending on December 31, 2020 and March 31, 2021, the firm reported revenues of Rs. 8.5 million and Rs. 11.3 million Seperately.

The department's chief adjudicator stated that the respondents took the procedures needed to revive the company's activities.

"Given the facts, I believe that it may not be in the interest of the company members to allow sanctions to submit a winding-up request at that stage. In addition, the firm's business has demonstrated recovery through dairy sales, which have resulted in the company resuming business."

"I noted that SCN's fundamental assumption, i.e. suspension of the company's business was dealt with. I thus do not find any cause to pursue the winding-up action against the firm and consequently do not take further action in this process," he said.

It should be noted that, on the basis that the firm has ceased its activity for more than six years, SEPE has commenced proceedings against the corporation through SCN.

On 28 March 1974, under the Company Act, 1913 (the Company Act of 2017) the company was established. The firm's main activity was the production, distribution, purchase and distribution of yams in various forms of yams. The company is listed at Pakistan Stock Exchange (PSX).

The firm has been suspended since 2009 according to the information available. As regards clause c) of Article 305 of the Ordinance, if the business of the company persists for a complete year, a corporation may be injured by the Court.

In accordance with Article 309(b), the Registration Office for Companies (CRO) has approached the High Court for granting a sanction on the grounds that the company has suspended its activities for more than six years, on the grounds that the Company has been read with clause (c) of Article 305 thereof.

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