SET 1

INTERNATIONAL ISLAMIC UNIVERSITY MALAYSIA

END-OF-SEMESTER EXAMINATION SEMESTER 2, 2012/2013 SESSION

KULLIYYAH OF ECONOMICS AND MANAGEMENT SCIENCES

Programme Time Duration : ENM/BBA/BACC/BECS : 2.30 p.m. 5.30 p.m. : 3 Hr(s) 0 Min(s) Level of Study : 2 - 4 Date : 27/5/2013

Course Code : LAW 3212 Course Title : Company Law

Section(s)

: 13

(This Examination Paper Consists of 3 Printed Pages Including A Cover Page With 5 Questions)

INSTRUCTION TO CANDIDATES: DO NOT OPEN THE QUESTION BOOKLET UNTIL YOU ARE ASKED TO DO SO

Instructions: There are five questions in this question paper. Students are required to answer any four (4) questions only. Each question carries equal marks. Acts will be provided:1. Companies Act 1965.

Any form of cheating or attempt to cheat is a serious offence which may lead to dismissal.
APPROVED BY:

ASSOC. PROF. DR. SUHAIMI MHD SARIF Head, Department of Business Administration Kulliyyah of Economics and Management Sciences

SET 1 Instructions: There are five questions in this question paper. Students are required to answer any four (4) questions only. Each question carries equal marks.

QUESTION 1 Explain the following briefly: i) Statutory meeting; [5 marks] ii) Extraordinary general meeting; [5 marks] iii) Islamic perspective on passing a resolution; [5 marks] iv) Grounds for challenging a resolution. [5 marks] QUESTION 2 Explain the following: a) Variation of class rights; [10 marks] b) The law and procedure for reduction of capital. [10 marks] QUESTION 3 Explain the following briefly: i) Functions of debentures; [5 marks] ii) Effect of non-registration of charges; [5 marks] iii) Rights of a chargee; [5 marks] iv) Priority of charges. [5 marks] 2

SET 1 QUESTION 4 a) Experienced and honest directors may offer good amount of dividends to shareholders in every year. Explain this statement from an Islamic perspective. [5 marks] b) Explain different types of legal and ethical duties and liabilities of directors referring to relevant decided cases and Quranic verses. [15 marks] QUESTION 5 The principle of perpetual succession states that a business company can survive forever, it never dies. In other words, a business company can continue doing business forever unless it is insolvent and closed down. It does not need to change the name of the company even if all the old shareholders sell their shares and leave the company and new shareholders come in after buying their shares. However, in exceptional circumstances a company may not survive forever, for example when the company becomes insolvent for some unexpected reasons as happened in 2008 in the US financial market for sub-prime loan scandal. In such a circumstance the company is wound up and a liquidator is appointed. Now answer the following questions:

a)

Explain in detail the reason, rule and procedure of members voluntary winding up and creditors voluntary winding up. [10 marks]

b)

Explain powers and functions of liquidators for a just and equitable winding up of the company. Give two references from Quran and hadith. [10 marks]