Company Matter No. 440 of 2026
Supreme Court of Bangladesh
High Court Division
(Statutory Original Jurisdiction)
A one-year suspension from one of Dhaka's established private club has produced two starkly different accounts of the same events which was brought before the High Court Division of the Supreme Court of Bangladesh through Company Matter No. 440 of 2026. The petitioner, a long-standing member and former Director of the Baridhara Cosmopolitan Club Limited (“Here and after BCCL”), a company limited by guarantee, incorporated under the Companies Act, 1994, says his suspension followed an allegation that was never properly disclosed to him and that changed materially over the course of the disciplinary proceeding. BCCL's Board of Directors, represented in these proceedings by three of the seven respondents, on the other hand said that the suspension followed a documented physical altercation in the Club Secretary's office, a pattern of earlier misconduct dating back to 2019, and a hearing at which the petitioner was given a full opportunity to explain himself.
The petitioner submitted that BCCL's disciplinary process had the appearance of compliance with Article 30 of its Memorandum and Articles of Association, a notice was issued and he was called to appear but not its substance: no written complaint was ever placed before him, no inquiry report was furnished, and the date of the alleged incident shifted from 9 December to 15 December 2025 once his passport contradicted the original date. He further submitted that the Club Secretary who raised the allegation also took part in deciding it, and that the suspension letter of 12 March 2026, issued under the Acting Secretary's signature, required the President's authority under Article 39. On this basis, the petitioner contended that the suspension breached Article 30 and the principle of audi alteram partem, is vitiated by mala fide, and is liable to be set aside, together with exemplary compensation tentatively assessed at Tk. 5,00,00,000 or such sum as the Court considers just and proper.
The respondents' on the other hand countered with submissions that the disciplinary process complied with Article 30 in substance, not merely in form: the incident grounding the suspension occurred on 15 December 2025, when the petitioner is said to have grown agitated in the Secretary's office, broken two paperweights, damaged the Deputy Secretary's keyboard, attempted to assault the Acting Secretary, and used abusive language, in breach of Clauses 30(a), (b) and (d) of BCCL's Articles; the reference to 9 December in the Incident Report was a clerical error, corrected on 22 February 2026 before the hearing, and petitioner's passport, showing his return to Bangladesh by 11 December 2025, does not account for his presence at the Club on 15 December. They further relied on petitioner's WhatsApp reply of 19 February 2026, which they characterise as an admission that he sent the messages in question, and on a disciplinary history comprising a three-month suspension in 2019 and a formal warning in 2023, which the Board weighed in resolving on 10 March 2026 to impose a one-year suspension, exceeding the Sub-Committee's recommendation of six months. On this basis, the respondents submitted that the petitioner was served notice, heard, and given a fair opportunity to respond, satisfying natural justice, and that no breach of audi alteram partem arises from the non-disclosure of an inquiry report.
The Petitioner relied on four authorities, each directed at a distinct limb of his case. The first is B.S.A. Association v. Bangladesh and Others (33 DLR (AD) (1981)) : for the proposition that natural justice applies to administrative and quasi-judicial proceedings alike, that no person can be deprived of a vested right without a hearing before an independent authority, and that the principles of natural justice are to be read into every enactment in the absence of a contrary provision. The Petitioner invoked this to argue that the disciplinary proceeding was vitiated from the outset: the charges were never particularised in writing, no inquiry report was furnished, and the Club Secretary - the originator of the complaint also participated in investigating and deciding it, sitting effectively as both accuser and adjudicator.
The second is Moqbul Ahmed & Anr. v. Ahmed Impex (Pvt) Ltd. & Ors. (16 BLD (AD) (1996) 133) : for the proposition that the Companies Act, 1994 is a special law under which the High Court Division is the sole Court with jurisdiction over company matters, and that Rule 8 and Rule 263 of the Companies Rules, 2009 vest this Court with inherent jurisdiction to pass any order for the ends of justice in the absence of a specifically designated forum. The Petitioner relied on this to resist the Respondents' maintainability objection and to establish that Section 43 read with those Rules is the proper vehicle for a member's challenge to a club's disciplinary proceedings conducted under its Articles of Association leading to suspension of his membership which is akin to termination of his ability to access club services and benefits.
The third is Jahangir Kabir Chowdhury v. Bangladesh Government and Others (22 BLC (AD) (2017)) : for the proposition that fraud vitiates all proceedings, that a proceeding obtained by false representation is a nullity in the eye of law, and that courts retain inherent power to nullify such proceedings even where the argument of functus officio is raised. The Petitioner invoked this against what he characterises as the most serious irregularity in the case: the alleged incident was originally placed on 9 December 2025, but when he produced his passport confirming he was in Calcutta, India between 8 and 11 December 2025, the Club shifted the date to 15 December 2025 without explanation - a change the Petitioner says amounts to the allegation being adjusted to defeat a verified alibi rather than reflecting any established fact, rendering the entire proceeding void.
The fourth is Shiv Ram Batta v. The Punjab Textile Mills, Limited and Others (PLD 1949 Lahore) : for the proposition that the Memorandum of Association is the charter of the company and the limitation of its powers, and that acts which are extra vires of the directors beyond the powers conferred upon them by the Articles of Association , are not binding upon the members. The Petitioner relied on this to challenge not only the procedure but the substance of the suspension: the additional conditions imposed alongside it - restricting him from bringing female guests for six months after the suspension ended, circulating the notice to affiliated clubs, and limiting his WhatsApp participation to official announcements only-find no authorisation in Article 30 or any other Article of BCCL's M&AoA and are accordingly extra vires the Board, just as the Club Secretary's combination of the roles of complainant and adjudicator found no authority in BCCL's governing documents.
Beyond disputing the facts, the respondents raise two objections to the case being heard at all. The first is that Section 43 of the Companies Act, 1994 confers jurisdiction on the High Court Division only for rectification of a company's register of members, and has no application to a dispute over the suspension of a member's privileges, which does not touch the register; they argue that Rule 8 and Rule 263 of the Companies Rules, 2009, and Section 345 of the Act, cannot supply a jurisdiction that the substantive provision does not confer, and rely on three reported decisions : Tamizul Haque v Shamsul Haque (43 DLR (AD) 34), Sher Ali Amir Ali Virjee v Eastern Industries (Bangladesh) Ltd. (43 DLR 54), and Afruz Miah v Al-Haj Md. Siraj Miah (43 DLR (AD) 89) -for the proposition that disputes turning on contested questions of fact belong before a civil court rather than in a Section 43 application. The second objection is that the application is premature: under Article 31 of BCCL's Articles, the Appellate Committee has forty-five days to decide an internal appeal, and the respondents say Mr. Khan approached the High Court, and obtained an interim stay on 13 May 2026, before that period had run, leaving his own appeal, in their submission, suspended out of deference to the Court rather than decided on its merits. We also relied upon the decision of this Division reported in 40 BLD 251, which squarely held such an application not maintainable. We submitted that the decision governed the present case and called for the same outcome. The Chittagong Club decision, though not reproduced in the written judgment, was placed before the Court during the hearing and informed the legal framework within which the Court's reasoning developed.
Where the Two Accounts Diverge
The affidavits filed on each side agree on very little beyond the identity of the parties and the governing document. The table below sets out the principal points of disagreement. Issue Petitioner's position Respondents' position Date and nature of the alleged incident No incident occurred on 9 December 2025; he was abroad at the time, and the allegation was later shifted, without explanation, to 15 December 2025. 15 December 2025 was always the correct date; 9 December was a clerical slip in the Incident Report, corrected in writing before the Sub-Committee hearing.
His passport evidence Shows he was outside Bangladesh from 8 to 11 December 2025 and could not have been involved in the incident. Confirms he had returned to Bangladesh by 11 December 2025, several days before 15 December and is silent on his presence at the Club that day. The “previous disciplinary record” cited in the suspension letter Never disclosed to him; relied upon without giving him any opportunity to respond. A three-month suspension in 2019 and a formal warning in 2023, both documented and annexed to the affidavit.
Length of the suspension One year said to exceed anything the process could justify. The Sub-Committee recommended six months; the Board imposed one year, citing the prior record. Authority to issue the suspension letter Should have issued under the President's authority under Article 39; instead issued by the Acting Secretary. Not addressed in the Affidavit-in-Opposition. Compliance with natural justice Denied: no written complaint was shown to him, no inquiry report was furnished, and the allegation itself shifted. Satisfied: a notice was served, a hearing was held, his explanation was considered, and a reasoned decision followed.
Verdict Gladius & Co. represented BCCL and its named office bearers the Court did not embark upon a lengthy discussion to resolve any of the six contested issues set out above. As a result, all of those questions remain open. The Court decided to dispose of the matter entirely at the threshold, on the maintainability objection that was raised on the Respondents' behalf from the outset in doing so. The Court heavily relied on the decision in Engr. Md. Anwar Hossen v. Chittagong Club Ltd. and Others (Company Matter No. 08 of 2019, decided 31 May 2020, per Muhammad Khurshid Alam Sarkar J.), in which the Hon’ble High Court Division had dismissed a materially identical challenge to a club membership suspension under Section 43 on the same footing, holding that the provision cannot be invoked to challenge disciplinary action that does not affect a member's position in the register.
The Hon’ble Company Bench in accepting our submissions held that the expression "omitted" in Section 43 refers to an omission from the statutory register itself and not to the temporary deprivation of rights flowing from membership. The Court expressly rejected the Petitioner's argument that the suspension amounted to a "constructive omission", holding that the Companies Act, 1994 employs no such expression and that the Court cannot introduce a legal fiction the legislature itself has not created. Purposive interpretation, the Court held, cannot travel so far as to rewrite a statute or enlarge the scope of a special statutory remedy beyond its plain language. The Court further held that the ancillary power under Section 43(3) to decide questions of law arising in a proceeding is exercisable only in aid of a validly constituted rectification proceeding and cannot itself become an independent source of jurisdiction, a finding that also disposed of the Petitioner's reliance on Moqbul Ahmed & Anr. v. Ahmed Impex (Pvt) Ltd. & Ors. (16 BLD (AD) (1996) 133) as authority for the Company Court's broad inherent powers in company matters. The Hon’ble Company Bench additionally noted, as a relevant circumstance, that the Petitioner had himself preferred an internal appeal under Article 31 of the Articles of Association on 11 April 2026, and that appeal was still pending before the Club's own appellate authority when the present application was filed on 30 April 2026 and the interim stay obtained on 13 May 2026.
The application under Section 43 of the Company Act, 1994 was accordingly dismissed as being not maintainable, with no order as to costs. The interim order of stay granted on 13 May 2026 ceased to operate upon dismissal. The Court directed BCCL's appellate authority to hear and dispose of the Petitioner's pending Article 31 appeal by a reasoned order within thirty days of communication of the judgment, and directed the learned Senior Advocate for the Respondents to communicate the order to the appellate authority forthwith.
Conclusion:
Company Matter No. 440 of 2026 presented our chamber with the task of defending a social and recreational club against an attempt to invoke the extraordinary statutory jurisdiction of the Company Court in a matter related to a private disciplinary dispute governed by the Club's own Articles of Association. The case raised a practically significant question for clubs and associations incorporated under the Companies Act, 1994: whether a member aggrieved by a disciplinary order of suspension may bypass the internal appellate remedy expressly provided by the club's own governing documents and instead approach the Company Court under Section 43.
The High Court Division answered that question definitively in the negative, affirming the line of authority we placed before the Court and confirming that Section 43 is a provision of limited and special statutory scope. Its jurisdiction is anchored to the correctness of the register of members. A temporary suspension, however serious its practical consequences- loss of voting rights, exclusion from general meetings, inability to contest elections, or deprivation of access to club facilities does not disturb a member's legal status in the register and therefore falls entirely outside Section 43. Grievances going to the fairness of a disciplinary process, the adequacy of notice, the authority behind an order, or compliance with a club's Articles of Association must be pursued before the competent Civil Court or such other forum as the law provides. The Company Court's jurisdiction is not enlarged by the gravity of the consequences a member suffers, by equitable considerations, or by the fact that the Court exercises general company jurisdiction. For clubs registered under the Companies Act, 1994, the broader significance of this outcome is clear. Robust internal appellate mechanisms in a club's Articles of Association are not merely a matter of good governance: they are, the legally required first recourse for a member who considers a disciplinary decision to have been made unfairly or without authority. Where a club's own Articles provide a route of internal appeal, that route must be taken and taken to its conclusion before the extraordinary statutory jurisdiction of the Company Court can properly be invoked.