bonifasia aidan mapunda vs the registrar of companies 2023 tzhccomd 85 24 march 2023

IN THE HIGH COURT OF THE UNITED REPUBLIC OF TANZANIA (COMMERCIAL DIVISION) AT DAR ES SALAAM MISC. COMMERCIAL CAUSE NO. 45 OF 2022 IN THE MATTER OF THE COMPANIES ACT, CAP 212 R.E. 2002 IN THE MATTER OF RESTORATION OF A COMPANY BETWEEN BONIFASIA AIDAN MAPUNDA................................. PETITIONER VERSUS THE REGISTRAR OF COMPANIES............................ RESPONDENT RULING Date of last order: 22/03/2023 Date of ruling:24/03/2023 AGATHO, J.: The Petitioner, BONIFASIA AIDAN MAPUNDA, a member of a Company named Pan African Lawyers Union (PALU), which was a body corporate duly incorporated under the laws of the United Republic of Tanzania petitioned to this Court under the provisions of Section 400(6) of the Companies Act, Cap 212 R.E. 2002 read together with the Written Laws (Miscellaneous Amendment) (No.3) Act, 2019 and any other enabling provisions of the law. The gist of the petition is that the Petitioner being an aggrieved member of PALU, the company that was deregistered from the Register of Companies by the Registrar of Companies following the enactment of The Written Laws (Miscellaneous Amendment) (No.3) Act, 2019 petitioned i to this court seeking inter aliaMhe. order to restore PALU in the register of companies. The detailed examination will be given in due course. The Petition was supported by an affidavit of the Petitioner. The Respondent on her side she did not file any counter affidavit to protest the amended petition. Both parties to the petition were under legal representation. Whereas the Petitioner was represented by Prof. Edward Gamaya Hoseah, learned counsel, the Respondent enjoyed the services of Ms. Grace Umoti, the learned State Attorney. On the 22/03/2023 hearing of the petition was conducted. PALU was incorporated on 10/06/2010 under Certificate of incorporation number 76846 as a company limited by guarantee. Her businesses were interaliato promote the Rule of Law, Good Governance and Human Rights in so doing to promote commerce, trade and investment as well as regional integration through harmonization of the laws in the SADC and the EAC by working with the SADC Lawyers Association and the East African Law Society. PALU organized among others continental conferences and regional seminars on the African Continental Free Trade Area (AfCTA). PALU also adopted a Declaration on Combating Illicit Financial flows from Africa on 7th June 2014. However, following the enactment of the Written Laws (Miscellaneous Amendment) (No.3) Act of 2019 the term "company" was redefined to mean a company formed and registered under the Companies Act, Cap 212 or existing company established for investment, trade or commercial activities, and any other activity as the Minister may, by notice published in the Gazette, prescribe. 2 By virtue of the amendments, the Registrar of Companies exercising powers through the letter dated 17/03/2020 notified the Petitioner that PALU was struck off the register of companies. This was done without affording PALU an opportunity to be heard. The Petitioner was therefore irked by the Registrar's decision to deregister PALU without affording the latter or the Petitioner an opportunity to provide reasons why it should not be deregistered as PALU still takes interest as she has always been conducting activities on the area and intends to continue promoting commerce, investment and trade as she operates in rule of law, good governance and human rights, and any other activities connected with the field of law and development. In the lieu of the foregoing the Petitioner seeks: 1. A declaration and an order that PALU be restored in the Register of Companies. 2. Any other relief this honourable court deems fit to grant. 3. No orders as to costs. As hinted earlier on, the Respondent State Attorney did not file any counter affidavit. During the hearing of the Petition she intimated that she does not object the petition as long the law is observed. On 22/03/2023 when the matter was heard the Petitioner's counsel restated content of the petition and prayed that PALU be restored in the register of companies. In determining the present petition, I examined the law, and according to Section 5 of the Written Laws (Miscellaneous Amendment) (No.3) Act of 2019, Section 3 of the Companies Act, Cap 212 R.E. 2002 3 was amended to require a company limited by guarantee to be registered under the Act. Besides the above Sections, Section 6 of the Written Laws (Miscellaneous Amendment) (No.3) Act of 2019 amended Section 3 of the Companies Act, Cap 212, R.E. 2002 and introduced Section 3A. This section provides that companies limited by guarantee, which were registered under the Companies Act as non-governmental organisations, shall regularise their affairs in accordance with the new law. Further to that, Section 10 of the Written Laws (Miscellaneous Amendment) (No.3) Act of 2019 amended Section 400 of the Companies Act, Cap 212 by adding Section 400-A (l)(a)-(e) stipulating circumstances under which the registrar of companies shall issue notice of his intention to strike the company off the register. As per Section 400 - A(e), the aforesaid notice may thus be given to a company which operates contrary to its objectives as stated in the MEMARTS. Despite that, Section 400 (6) and Section 400-A (6) of the Companies Act (as amended) is to the effect that a de-registered company may be restored. For avoidance of doubt Section 400 (6) provides: "Zf a company or any member or creditor thereof fee/s aggrievedby the company having been struck offthe register the Court on an appiication made by the company or member or creditor before the expiration of ten years from the pubiication in the Gazette ofthe notice above may, ifsatisfied that the company was at the time ofthe striking offcarrying on business or in operation, or otherwise that it is just that the company be restored to the register, order the name of 4 the company to be restored to the register, and upon a certified copy ofthe order being delivered to the Registrar for registration, the companyshaii be deemedto have continued in existence as ifits name had not been struck off, and the court may by the order give such directions and make such provisions as seem just forpiacing the company and aii other persons in the same position as neariy as may be as if the name ofthe company has not been struck off" The powers of the Court are echoed in Section 400A (5) and (6) of the Companies Act, Cap 212 as amended that when an application for restoration is brought before the Court, it may make such orders and give further direction as it deems fit as if the company had not been struck off from the register. See the case of Bahari Schools Limited v The Register of Companies, Misc. Commercial Cause No. 12 of 2022, HCCD at Dar es salaam at p.7. In view of the above legal standpoint, the pleadings, and the submission by the Petitioner's counsel, I am convinced that the restoration order sought is meritorious. I thus order as follows: 1. That, the application is granted. 2. The Registrar's order to strike Pan African Lawyers Union (PALU) off the Companies register is hereby quashed and set aside and the status quo ante is restored. 3. The petitioner is granted six (6) months period to ensure that PALU's Memorandum and Articles of Association are duly amended in conformity with the requirements of the law. 4. No order as to costs is given. 5 It is so ordered. DATED at DAR ES SALAAM this 24th Day of March 2023. U. J. AGATHO JUDGE 24/03/2023 Date: 24/03/2023 Coram: Hon. UJ. Agatho 1 For Petitioner: Denis Ukaka, Advocate For Respondent: Denis Ukaka, Advocate holding brief of Grace Umoti, State Attorney. C/Clerk: Beatrice Court: Ruling delivered today, this 24th March 2023 in the presence of Denis Ukaka, learned counsel for the Petitioner, also holding brief of Grace Umoti, State Attorney for Respondent. U. JJAGATHO JUDGE 24/03/2022 6