THE
VOLUNTARY SOCIAL
WELFARE AGENCIES
(REGISTRATION AND
CONTROL) ORDINANCE, 1961.
ORDINANCE NO. XLVI OF 1961
2nd December, 1961
An Ordinance to provide for the registration
and control of voluntary social welfare agencies.
WHEREAS it is expedient to provide for the registration and control
of voluntary social welfare agencies, and for matters ancillary thereto;
Now, THEREFORE, in pursuance of the Proclamation of
the seventh day of October, 1958, and in exercise of all powers enabling him
in that behalf, the President is pleased to make and promulgate the following Ordinance:—
1. Short title, extent and commencement. —(1) This Ordinance may be called the
Voluntary Social Welfare Agencies (Registration and Control) Ordinance, 1961.
(2) It extends to the whole of Pakistan
(3) It shall come into force on such
date as the Provincial Government may, by notification in the official Gazette,
appoint in this behalf.
2. Definitions. In this Ordinance, unless there is
anything repugnant in the subject or context,—
(a) “agency” means a voluntary social
welfare agency, and includes any branch of such agency;
(b) “governing body” means the
council, committee, trustees or other body, by whatever name called, to whom,
by the constitution of the agency, its executive functions and the management
of its affairs are entrusted;
(c) “prescribed” means prescribed by
rules made under section 19;
(d) “register” means the register
maintained under section 4, and “registered” shall mean registered under this Ordinance;
(e) “Registration Authority” means 2 an officer authorized by the (Provincial
Government, by notification in the official Gazette, to exercise all or any of
the powers of the Registration Authority under this Ordinance;
(f) “voluntary social welfare agency”
means an organization, association or undertaking established by persons of
their own free will for the purpose of rendering welfare services in any one
or more of the fields mentioned in the Schedule and depending for its resources
on public subscriptions, donations or Government aid.
3. Prohibition against
establishing or continuing an agency without registration. No agency shall be established or continued
except in accordance with the provisions of this Ordinance.
4. Application for registration, etc. —(1) Any person intending to establish an agency, and
any person intending that an agency already in existence should be continued as
such, shall, in the prescribed form, and on payment of the prescribed fee,
make an application to the Registration Authority, accompanied by a copy of
the constitution of the agency, and such other documents as may be prescribed.
(2) The Registration Authority may,
on receipt of the application, make such inquiries as it considers necessary,
and either grant the application, or, for reasons to be recorded in writing,
reject it.
(3) If the Registration Authority
grants the application, it shall issue, in the prescribed form, a certificate
of registration to the applicant.
(4) The Registration Authority shall
maintain a register, containing such particulars as may be prescribed, of all
certificates issued under sub-section (3).
5. Establishment and continuance agency. —(1) An agency not in existence on the
coming into force of this Ordinance shall be established only after a certificate
of registration has been issued under sub-section (3) of section 4.
(2) An agency already in existence
shall not be continued for more than six months from the date on which this Ordinance
comes into force, unless an application for its registration has, within thirty
days of such date, been made under sub-section
(1) of section 4.
(3) Where an application as aforesaid
has been made in respect of an existing agency, and such application is
rejected, then, notwithstanding the period of six months provided in
sub-section
(2), the agency may be continued for
a period of thirty days from the date on which the application is rejected, or
if an appeal is preferred under section 6, until such appeal is dismissed.
6. Appeal. If the Registration Authority rejects an
application for registration, the applicant may, within thirty days from the
date of the order of the Registration Authority, prefer an appeal to the
Provincial Government, and the order passed by the Provincial Government shall
be final and given effect to by the Registration Authority.
7. Conditions to be complied with by registered agencies. —(1) Every registered agency shall—
(a) maintain audited accounts in the
manner laid down by the Registration Authority ;
(b) at such time and in such manner
as may be prescribed, submit its Annual Report and audited accounts to the
Registration Authority and publish the same for general information ;
(c) pay all moneys received by it
into a separate account kept in its name at such bank or banks as may be approved
by the Registration Authority ; and
(d) furnish to the Registration
Authority such particulars with regard to accounts and other records as the
Registration Authority may from time to time require.
(2) The Registration Authority, or any officer duly
authorized by it in this behalf, may at all reasonable times inspect the books
of account and other records of the agency, the securities, cash and other
properties held by the agency, and all documents relating thereto.
8. Amendment of the constitution of registered agency. —(1) No amendment of the constitution
of a registered agency shall be valid unless it has been approved by the Registration
Authority, for which purpose a copy of the amendment shall be forwarded to the
Registration Authority.
(2) If the Registration Authority is
satisfied that any amendment of the constitution is not contrary to any of the
provisions of this Ordinance or the rules made thereunder, it may, if it thinks
fit, approve the amendment.
(3) Where the Registration Authority
approves an amendment of the constitution, it shall issue to the agency a copy
of the amendment certified by it, which shall be conclusive evidence that the
same is duly approved.
9. Suspension or dissolution of governing bodies of registered agencies.
—(1) If, after
making such inquiries as it may think fit, the Registration Authority is
satisfied that a registered agency has been responsible for any irregularity in
respect of its funds or for any maladministration in he conduct of its affairs
or has failed to comply with the provisions of this Ordinance or the rules made
thereunder, it may, by order in writing, suspend the governing body.
(2) Where a governing body is
suspended under sub-section (1), the Registration Authority shall appoint an
administrator, or a caretaker body consisting of not more than five persons,
who shall have all the authority and powers of the governing body under the
constitution of the agency.
(3) Every order of suspension under
sub-section (1) shall be placed by the Registration Authority before a Board,
consisting of not more than five persons, constituted by the Provincial
Government for the purpose, which shall have the power to make such order as to
the re-instatement, or the dissolution and reconstitution, of the governing
body, as it may think fit.
(4) The governing body against whom
an order of dissolution and reconstitution is made under sub-section (3) may
appeal to the Provincial Government, within thirty days from the date of such
order, and the decision of the Provincial Government shall be final and shall
not be called in question in any court.
10. Dissolution of registered agency. —(1) If at any time the Registration Authority has
reason to believe that a registered agency is acting in contravention of its constitution,
or contrary to any of the provisions of this Ordinance or the rules made
thereunder, or in a manner prejudicial to the interests of the public, it may,
after giving such opportunity to the agency of being heard as it thinks fit,
make a report thereon to the Provincial Government.
(2) The Provincial Government, if
satisfied after considering the report that it is necessary or proper to do so,
may order that the agency shall stand dissolved on and from such date as may be
specified in the order.
11. Voluntary dissolution of registered agency. —(1) No registered agency shall be
dissolved by the governing body or members thereof.
(2) If it is proposed to dissolve any
registered agency, not less than three-fifths of its members may apply to the
Provincial Government, in such manner as may be prescribed, for making order
for the dissolution of such agency.
(3) The Provincial Government, if
satisfied after considering the application that it is proper to do so, may
order that the agency shall stand dissolved on and from such date as may be
specified in the order.
12. Consequences of dissolution. —(1) Where any agency is dissolved under this Ordinance, its
registration thereunder shall stand cancelled on and from the date the order of
dissolution takes effect, and the Provincial Government may—
(a) order any bank or other person
who holds moneys, securities or other assets on behalf of the agency not to
part with such moneys, securities and assets without the previous permission in
writing of the Provincial Government;
(6) appoint a competent person to
wind up the affairs of the agency, with power to institute and defend suits and
other legal proceedings on behalf of the agency, and to make such orders and
take such action as may appear to him to be necessary for the purpose ; and
(c) order any moneys, securities and
assets remaining after the satisfaction of all debts and liabilities of the
agency to be paid or transferred to such other agency, having objects similar
to the objects of the agency, as may be specified in the order.
(2) Orders made by the person
appointed under clause (b) of sub-section (1) shall, on application, be
enforceable by any Civil Court
13. Inspection of documents,
etc. Any person may, on payment of the prescribed fee,
inspect at the office of the Registration Authority any document relating to a
registered agency, or obtain a copy of or an extract from any such document.
14. Penalties and procedure. —(1) Any person who—
(a) contravenes any of the provisions
of this Ordinance, or any rule or order made thereunder ; or
(b) in any application for
registration under this Ordinance, or in any report or statement submitted to
the Registration Authority or published for general information thereunder,
makes any false statement or false representation ;
shall be punishable with imprisonment
for a term which may extend to six months, or with fine which may extend to two
thousand rupees, or with both.
(2) Where the person committing an
offence under this Ordinance is a company, or other body corporate, or an
association of persons, every director, manager, secretary and other officer
thereof shall, unless he proves that the offence was committed without his
knowledge or consent, be deemed to be guilty of such offence.
15. Indemnity. No suit, prosecution or other legal
proceeding shall lie against any person for anything which is in good faith
done or intended to be done under this Ordinance.
16. Power to amend Schedule. The Provincial Government may, by
notification in the official Gazette, amend the Schedule so as to include
therein or exclude therefrom any field of social welfare service.
17. Power to exempt. The Provincial Government may, by
notification in the official Gazette, exempt any agency or class of agencies
from the operation of all or any of the provisions of this Ordinance.
18. Delegation of powers. The Provincial Government may, by
notification in the official Gazette, delegate all or any of its powers under
this Ordinance, either generally, or in respect of such agency or class of
agencies as may be specified in the notification, to any of its officers,
19. Rules. The
Provincial Government may, by notification in the official Gazette, make rules
for carrying into effect the provisions of this Ordinance.
THE SCHEDULE
See section 2 (f)
(i) Child welfare.
(ii) Youth welfare.
(iii) Womens welfare.
(iv) Welfare of the physically and
mentally handicapped.
(y) Family planning.
(vi) Recreational programs intended
to keep people away from anti-social activities.
(vii) Social education, that is,
education of adults aimed at developing sense of civic responsibility.
(viii) Welfare and rehabilitation of
released prisoners.
(ix) Welfare of juvenile delinquents.
(x) Welfare of the socially
handicapped.
(xi) Welfare of the beggars and
destitutes.
(xii) Welfare and rehabilitation of
patients.
(xiii) Welfare of the aged and
infirm.
(xiv) Training in social work.
(xv) Co-ordination of social welfare
agencies.
PART II
BUSINESS OF BANKING COMPANIES
7. Forms of business in which banking companies may engage. — (1) In addition to the business of
banking, a banking company may engage in any one or more of the following forms
of business, namely:—
(a) the borrowing, raising, or taking
up of money; the lending or advancing of money either upon or without security;
the drawing, making, accepting, discounting, buying, selling, collecting and
dealing in bills of exchange, hoondees, promissory notes, coupons, drafts,
bills of lading, railway receipts, warrants, debentures, certificates, scrips
and other instruments, and securities whether transferable or negotiable or
not; the granting and issuing of letters of credit, travelers cheques and
circular notes; the buying, selling and dealing in bullion and species; the
buying and selling of foreign exchange including foreign bank notes; the
acquiring, holding, issuing on commission, underwriting and dealing in stock,
funds, shares, debentures, debenture stock, bonds, obligations, securities and
investments of all kinds; the purchasing and selling of bonds, scrips or other
forms of securities on behalf of constituents or others, the negotiating of
loans and advances; the eiving of all kinds of bonds, scrips or valuables on
deposit or for safe custody or otherwise; the providing of safe deposit vaults;
the collecting and transmitting of money and securities;
(b) acting as agents for any
Government or local authority or any other person or persons; the carrying on
of agency business of any description including the clearing and forwarding of
goods, giving of receipts and discharges and otherwise acting as an attorney on
behalf of customers, but excluding the business of a managing agent or
treasurer of a company;
(c) contracting for public and
private loans and negotiating and issuing the same;
(d) the effecting, insuring,
guaranteeing, underwriting, participating in managing and carrying out of any
issue, public or private, Government, municipal or other loans or of shares,
stock, debentures, or debenture stock of any company, corporation or association
and the lending of money for the purpose of any such issue;
(e) carrying on and transacting every
kind of guarantee and indemnity business;
(f) managing, selling and realising
any property which may come into the possession of the company in satisfaction
or part satisfaction of any of its claims;
(g) acquiring and holding and
generally dealing with any property or any right, title or interest in any such
property which may form the security or part of the security for any loans or
advances or which may be connected with any such security;
(h) undertaking and executing trusts;
(i) undertaking the administration of
estates as executor, trustee or otherwise;
(j) establishing and supporting or
aiding in the establishment and support of associations, institutions, funds,
trusts and conveniences calculated to benefit employees or ex-employees of the
company or the dependents or connections of such persons; granting pensions and
allowances and making payments towards insurance;
subscribing to or guaranteeing moneys
for charitable or benevolent objects or for any exhibition or for any public,
general or useful object;
(k) the acquisition, construction,
maintenance and alteration of any building or works necessary or convenient
for the purposes of the company;
(l) selling, improving, managing,
developing, exchanging, leasing, mortgaging, disposing of or turning into
account or otherwise dealing with all or any part of the property and rights of
the company;
(m) acquiring and undertaking the
whole or any part of the business of any person or company, when such business
is of a nature enumerated or described in this sub-section;
(n) doing all such other things as
are incidental or conducive to the promotion or advancement of the business
of the company;
(o) any other form of business which
the Central Government may, by notification in the official Gazette, specify
as a form of business in which it is lawful for a banking company to engage.
(2) No banking company shall engage
in any form of business other than those referred to in sub-section (1).
8. Use of the word “Banking” or any of its derivatives. After the expiry of two years from the commencement of this Ordinance
every company carrying on the business of banking in Pakistan shall use the
word “bank”, or any of its derivatives as part of its name and no company other
than a banking company shall use in its name any word calculated to indicate
that it is a banking company:
Provided that nothing in this section
shall apply to— (a) subsidiary of a banking company formed for one or more of
the purposes mentioned in sub-section (1) of section 23 whose name indicates
that it is a subsidiary of that banking company; and
(b) any association of banks formed
for the protection of their mutual interests and registered under section 26 of
the Companies Act, 1913.
9. Prohibition of trading. Notwithstanding anything contained in
section 7 or in any contract, no banking company shall directly or indirectly
deal in the buying or selling or bartering of goods, except in connection with
the realisation of security given to or held by it. or engage in any trade or
buy, sell or barter goods for others otherwise than in connection with bills of
exchange received lor collection or negotiation or with such of its business as
is referred to in clause (i) of sub-section (1) of section 7:
Provided that this section shall not
apply to any such business as aforesaid which was in the course of being
transacted on the commencement of this Ordinance, so however, that the said
business shall be completed before the expiry of one year from such
commencement.
Explanation.—For the purposes of this
section, “goods” means every kind of movable property, other than actionable
claims, stocks, shares, money, bullion and specie, and all instruments
referred to in clause (a) of sub-section (1) of section 7.
10. Disposal of non-banking assets.
Notwithstanding
anything contained in section 7, no banking company shall hold any immovable
property howsoever acquired, except such as is required for its own use, for
any period exceeding seven years from the acquisition thereof or from the
commencement of this Ordinance, whichever is later or any extension of such
period as in this section provided, and such property shall be disposed of
within such period or extended period, as the case may be:
Provided that the banking company
may, within the period of seven years as aforesaid, deal or trade in any such
property for the purpose of facilitating the disposal thereof:
Provided further that the State Bank
may in any particular case extend the aforesaid period of seven years by such
period not exceeding five years where it is satisfied that such extension would
be in the interests of the depositors of the banking company.
Explanation.—For the purpose of this
section property, a substantial portion of which is in use by banking company
for its own genuine requirements shall be deemed to be property for its own
use.
11. Prohibition of employment of managing agents and restrictions on
certain forms of employment. — (1) No banking company—
(a) shall employ or be managed by a
managing agent; or
(b) shall employ or continue the
employment of any person—
(i) who is, or at any time has been,
adjudicated insolvent, or has suspended payment, or has compounded with his
creditors, or who is, or has been, convicted by a criminal court of an offence
involving moral turpitude; or
(ii) whose remuneration or part of
whose remuneration takes the form of commission or of a share in the profits of
the company:
Provided that nothing contained in
sub-clause (ii) shall apply to the payment by a banking company of—
(a) any bonus in pursuance of a
settlement or award arrived at or made under any law relating to industrial
disputes or in accordance with any scheme framed by such banking company or in
accordance with the usual practice prevailing in banking business; or
(b) any commission to any broker
(including guarantee broker), cashier-contractor, clearing and forwarding
agent, auctioneer or any other person, employed by the banking company under a
contract otherwise than as a regular member of the staff of the company; or
(c) shall be managed by any person—
(i) who is a director of any other
company not being a subsidiary company of the banking company or a company
registered under section 26 of the Companies Act, 1913, except with the
previous approval of the State Bank; or
(ii) who is engaged in any other
business or vocation; or
(iii) who has a contract with the
company for its management for a period exceeding five years at any one time:
Provided that any contract with the
company for its management may be renewed or extended for a further period not
exceeding five years at a time if and so often as the directors so . decide:
Provided further that nothing in this
clause shall apply to a director, other than the managing director, of a
banking company by reasons only of his being such director.
(2) Where a person holding the office
of a chairman or director or manager or chief executive officer (by whatever
name called) of a banking company is, or has been found by any tribunal or
other authority (other than a criminal court) to have contravened the
provision of any law and the State Bank is satisfied that the contravention is
of such a nature that the association of such person with the banking company
is or will be detrimental to the interests of the banking company or its
depositors or otherwise undesirable, the State Bank may make an order that
that person shall cease to hold the office with effect from such date as may be
specified therein and thereupon, that office shall, with effect from the said
date, become vacant.
(3) Any order made under sub-section
(2) in respect of any person may also provide that he shall not, without the
previous permission of the State Bank in writing, in any way, directly or
indirectly, be concerned with, or take part in the management of, the banking
company or any other banking company for such period not exceeding five years
as may be specified in the order.
(4) No order under sub-section (2)
shall be made in respect of any person unless he has been given an opportunity
of making a representation to the State Bank against the proposed order:
Provided that it shall not be
necessary to give any such opportunity if, in the opinion of the State Bank, any
delay would be detrimental to the interests of the banking company or its
depositors.
(5) Any decision or order of the
State Bank made under this section shall be final for all purposes.
12. Restrictions on removal of records and documents. No banking company shall remove from Pakistan to a place outside Pakistan
Explanation.—In this section the term
“records” means ledgers, day-books, cash books, accounts books and all other
books used in the business of a banking company and the term “documents” means
vouchers, cheques, bills, pay orders, securities for advances and any other
documents supporting entries in the books of, or claims by or against, a
banking company.
13. Requirement as to minimum paid
up capital and reserves. — (1) Notwithstanding anything contained in section 103 of the Companies
Act, 1913, no banking company in existence on the commencement of this Ordinance
shall, after the expiry of two years from such commencement, if it is
incorporated in Pakistan and of six months if it is incorporated outside
Pakistan, carry on business in Pakistan, and no other banking company shall,
after the commencement of this Ordinance commence or carry on business in
Pakistan, unless it has paid-up capital and reserves of such aggregate value as
is hereinafter required by this section:
Provided that the State Bank may, if
it thinks fit in any particular case, extend the period referred to in this
sub-section by a further period not exceeding one year in the case of banking
companies incorporated in Pakistan and six months in the case of banking
companies incorporated outside Pakistan.
(2) In the case of a banking company
incorporated in Pakistan the aggregate value of its paid-up capital and
reserves shaU not be less than—
(i) if it has places of business in
both the Wings of Pakistan one or more of which is or are situated in the City
of Karachi or Lahore, or Dacca or Chittagong, ten lakhs of rupees;
(ii) if it has places of business in
both the Wings of Pakistan none of which is situated in the City of Karachi or
Lahore or Dacca or Chittagong, five lakhs of rupees;
(iii) if it has places of business
either in West Pakistan or in East Pakistan ,—
(a) if one or more of its places of
business is or are situated in the City of Karachi
or Lahore or Dacca
or Chittagong
(b) if none of its places of business
is situated in the City of Karachi or Lahore or Dacca or Chittagong
(iv) if it has only one place of
business either in West Pakistan or East Pakistan ,—
(a) if the place of business is
situated in the City of Karachi or Lahore or Dacca or Chittagong
(b) if the place of business is
situated in a City other than Karachi or Lahore or Dacca or Chittagong
(3) In the case of a banking company
incorporated outside Pakistan the aggregate value of its paid-up capital and
reserves shall not at the close of any day be less than twenty lakhs of rupees
or an amount representing 5 per cent. of the total demand and time liabilities
of such company in Pakistan
Provided that no such banking company
shall be deemed to have complied with the provisions of this sub-section unless
it deposits and keeps deposited with the State Bank an amount not less than
what is required to be maintained under this sub-section, either in cash or in
unencumbered approved securities or partly in cash and partly in such
securities:
Provided further that a deposit so
made with the State Bank shall be by transfer of funds by the banking company
from outside Pakistan or in the form of assets acquired by the banking Company
out of remittable profits made by it from deposits in Pakistan.
(4) Any amount deposited and kept
deposited with the State Bank under the proviso to the sub-section (3) by any
banking company incorporated outside Pakistan shall, in the event of the
company ceasing for any reason to carry on banking business in Pakistan, be an
asset of the company on which the claims of all the creditors of the company in
Pakistan shall be a first charge.
(5) For the purposes of this section—
(a) “place of business” means any
office, sub-office, sub-pay office and any place of business at which deposits
are received, cheques cashed or moneys lent;
(b) “value” means the real or
exchangeable value, and not the nominal value which may be shown in the books
of the banking company concerned.
(6) If any dispute arises in
computing the aggregate value of the paid-up capital and reserves of any
banking company, a determination thereof by the State Bank shall be final for
the purposes of this section.
14. Regulation of paid-up capita, subscribed capital and authorized
capital and voting rights of share holders. — (1) No banking company incorporated
in Pakistan shall carry on
business in Pakistan
(i) that the subscribed capital of
the company is not less than one half of the authorized capital and the paid-up
capital is not less than one half of the subscribed capital and that if the
capital is increased it complies with the conditions prescribed in this clause
within such period not exceeding two years as the State Bank may allow;
(ii) that the capital of the company
consists of ordinary
shares only;
(iii) that, subject to the provisions
contained in clause (iv), the voting rights of any one shareholder are strictly
proportionate to the contribution made by him to the paid-up capital of the
company;
(iv) that the voting rights of any
one shareholder, except those of the Central Government or a Provincial Government,
do not exceed five per cent. of the total voting rights of all the
shareholders.
(2) Notwithstanding anything
contained in any law for the time being in force or in any contract or
instrument no suit or other proceeding shall be maintained against any person
registered as the holder of a share in a banking company on the ground that the
title to the said share vests in a person other than the registered holder:
Provided that nothing contained in
this sub-section shall bar a suit or other proceeding—
(a) by a transferee of the share on
the ground that he has obtained from the registered holder a transfer of the
share in accordance with any law relating to such transfer; or
(b) on behalf of a minor or a lunatic
on the ground that the registered holder holds the share on behalf of the minor
or lunatic.
(3) Every chairman, managing director
or chief executive officer by whatever name called of a banking company shall
furnish to the State Bank through that banking company returns containing full
particulars of the extent and value of his holding of shares, whether directly
or indirectly, in the banking company and of any change in the extent of such
holding or any variation in the rights attaching thereto and such other
information relating to those shares as the State Bank may, by order, require
and in such form and at such time as may be specified in the order.
15. Election of new directors. —(1) The State Bank may, by order, require any banking
company to call a general meeting of
the shareholders of the company within such time, not less than two months from
the date of the order, as may be specified therein or within such further time
as the State Bank may allow in this behalf, to elect in accordance with the
voting rights permissible under this Ordinance fresh directors, and the banking
company shall be bound to comply with the order.
(2) Every director elected under
sub-section (1) shall hold office until the date up to which his predecessor
would have held office, if the election had not been held.
(3) Any election duly held under this
section shall not be called in question in any court.
16. Restrict ion on commission, brokerage, discount, etc., on sale of
shares. Notwithstanding anything to the
contrary in sections 105 and 105-A of the Companies Act, 1913, no banking
company shall pay out directly or indirectly by way of commission, brokerage,
discount or remuneration in any form in respect of any shares issued by it, any
amount exceeding in the aggregate two and one-half per cent. of the paid-up
value of the said shares.
17. Prohibition of charge on unpaid capital. No banking company shall create any charge upon any unpaid
capital of the company and any such charge, if created, shall be invalid.
18. Prohibition of floating charge on assets. —(1) Notwithstanding anything
contained in section 7 no banking company shall create a floating charge on the
undertaking or any property of the company or any part thereof, unless the
creation of such floating charge is certified in writing by the State Bank as not
being detrimental do the interests of the depositors of such company.
(2) Any such charge created without
obtaining the certificate of the State Bank shall be invalid.
(3) Any banking company aggrieved by
the refusal of a certificate under sub-section (1) may, within ninety days from
the date on which such refusal is communicated to it, appeal to the Central
Government.
(4) The decision of the Central
Government where an appeal has been preferred to it under sub-section (3) or
of the State Bank where no such appeal has been preferred shall be final,
19. Restrictions as to payment of dividend. —(1) No banking company shall pay any
dividend on its shares until all its capitalised expenses (including
preliminary expenses, organisation expenses,
share-selling commission, brokerage, amounts of losses incurred and any
other item of expenditure not represented by tangible assets) have been completely
written off.
(2) Notwithstanding anything to the
contrary contained in sub-section (1) or in the Companies Act, 1913, a banking
company may pay dividends on its shares without writing off—
(i) the depreciation, if any, in the
value of its investments in approved securities in any case where such depreciation
has not actually been capitalised or otherwise accounted for as a loss ;
(ii) the depreciation, if any, in the
value of its investments in shares, debentures or bonds (other than approved
securities) in any case where adequate provision for such depreciation has been
made to the satisfaction of the auditor of the banking company ;
(iii) the bad debts, if any, in any
case where adequate provision for such debts has been made to the satisfaction
of the auditor of the banking company.
20. Prohibition of common directors. —(1) Except with the permission of the State Bank, no
banking company incorporated in Pakistan
(i) of any other banking company ; or
(ii) of companies which among
themselves are entitled to exercise voting rights in excess of twenty per cent.
of the total voting rights of all the shareholders of the banking company.
(2) If immediately before the
commencement of this Ordinance any person holding office as a director of a
banking company is also a director of companies which among themselves are
entitled to exercise voting rights in excess of twenty per cent. of the total
voting rights of all the shareholders of the banking company he shall, within
such period from such commencement as the State Bank may specify in this
behalf—
(a) either resign his office as a
director of the banking company ; or
(b) choose such number of companies
as among themselves are not entitled to exercise voting rights in excess of
twenty per cent. of the total voting rights of all the shareholders of the
banking company as companies in which he wishes to continue to hold the office
of a director and resign his office as a director in the other companies.
21. Reserve Fund. —(1) Every banking company incorporated in Pakistan shall create a reserve
fund and unless the amount in such fund together with the amount in the share
premium account is not less than its paid-up capital, shall, out of the balance
of profit of each year as disclosed in the profit and loss account prepared
under section 33 and before any dividend is-declared, transfer to the reserve
fund a sum equivalent to not less than twenty per cent. of such profit.
(2) Where a banking company
appropriates any sum or sums from the reserve fund or the share premium
account, it shall, within twenty-one days from the date of such appropriation,
report the fact to the State Bank explaining the circumstances relating to such
appropriation :
Provided that the State Bank may, in
any particular case, extend the said period of twenty-one days by such period
as it thinks fit or condone any delay in the making of such report.
22. Cash Reserve. Every banking company, not being a
scheduled bank, shall maintain by way of cash reserve in cash with itself, or
in current account opened with the State Bank or its agent or partly in cash
with itself and partly in such account or accounts a sum equivalent to at least
two per cent. of its time liabilities in Pakistan
Explanation.—In this section and in
section 29, “liabilities in Pakistan” shall not include the paid-up capital or
tl-.e reserves or any credit balance in the profit and loss account of the banking
company or the amount of any loan taken from the State Bank.
23. Restriction on the nature of subsidiary companies. — (1) A banking company shall not from
any subsidiary company except a subsidiary company formed for one or more of
the following purposes, namely :—
(a) the undertaking and executing of
trusts,
(b) the undertaking of the
administration of estates as executor, trustee or otherwise,
(c) the providing of safe deposit
vaults,
(d) with the previous permission in
writing of the State Bank, the carrying on of the business of banking
exclusively outside Pakistan
(e) such other purposes as are
incidental to the business of banking.
(2) Save as provided in sub-section
(1), no banking company shall hold shares in any company whether as pledgee,
mortgagee or absolute owner, of an amount exceeding thirty per cent. of the
paid-up share capital of that company or thirty per cent. of its own paid-up
share capital and reserves, whichever is less :
Provided that any banking company
which is on the date of commencement of this Ordinance holding any shares in
contravention of the provisions of this subsection shall not be liable to any
penalty therefor if it reports the matter without delay, to the State Bank and
if it brings its holding of shares into conformity with the said provisions
within such period, not exceeding two years, as the State Bank may think fit
to allow.
(3) Save as provided in sub-section
(1) and notwithstanding anything contained in sub-section (2), a banking
company shall not, after the expiry of one year from the date of commencement
of this Ordinance hold shares, whether as pledgee, mortgagee or absolute owner,
in any company in the management of which any managing director or manager of
the banking company is in any manner concerned or interested.
24. Restrictions on loans and advances. —(1) Notwithstanding anything to the
contrary contained in section 54A of the Companies Act, 191-3, no banking
company shall make any loans or advances on the security of its own shares or grant
unsecured loans or advances to any of its directors or to firms or private
companies in which it or any of its directors is interested as partner or
managing agent, or to any individuals, firms or private companies in cases
where any of the directors is a guarantor.
(2) No banking company shall make
loans or advances to any of its directors or to individuals, firms, or
companies in which it or any of its directors is interested as partner,
director, managing agent or guarantor, as the case may be, without the
approval of the majority of the directors of that banking company, excluding
the director concerned.
(3) Every banking company shall,
before the close of the month succeeding that to which the return relates,
submit to the State Bank a return in the prescribed form and manner, showing
particulars of—
(a) all unsecured loans and advances
granted by it to companies, private as well as public in which it or any of
its directors is interested as a director; and
(b) all unsecured loans and advances granted
by it to public companies in which it or any of its directors is interested as
managing agent or guarantor.
(4) If on examination of any return
submitted under subsection (3) it appears to the State Bank that any loans or
advances referred to in that sub-section have been granted to the detriment of
the interests of the depositors of the banking company, the State Bank may, by
order in writing, prohibit the banking company from granting any such further
loans or advances or impose such restrictions on the grant thereof as it thinks
fit, and may, by like order, direct the banking company to secure the repayment
of any such loans or advances within such time as may be specified in the
order.
25. Powers of state Bank to control advances by banking companies. —(1) Whenever the State Bank is
satisfied that it is necessary or expedient in the public interest so to do, it
may determine the policy in relation to advances to be followed by banking
companies generally or by any banking company in particular and when the policy
has been so determined, all banking companies or the banking company
concerned, as the case may be, shall be bound to follow the policy as so
determined.
(2) Without prejudice to the
generality of the power vested in the State Bank under sub-section (1), the
State Bank may give directions to banking companies either generally or to any
banking company or group of banking companies in particular, as to the purposes
for which advances may or may not be made, the margins to be maintained in
respect of secured advances and the rates of interest to be charged on advances
and each banking company shall be bound to comply with any directions as so
given.
26. Power of central Government to Prohibit acceptance of deposits by
banking companies incorporated outside Pakistan Pakistan
(1) discontinue to accept any
interest bearing deposits or accept
such deposits only upon such terms and under such conditions as may be
specified in the notification:
Provided that no such notification
shall be made earlier than three years after the commencement of this Ordinance
and the date specified in the notification shall not be earlier than six months
after the date of the notification; or
(2) discontinue to accept any
deposits or accept deposits only upon such terms and under such conditions as
may be specified in the notification:
Provided that no such notification
shall be made earlier than three years after the commencement of this Ordinance
and the date specified in the notification shall not be earlier than one year
from the date of the notification.
27. Licensing of banking companies. —(1) Save as hereinafter provided, no company shall
carry on banking business in Pakistan unless it holds a licence issued in that
behalf by the State Bank and any such licence may be issued subject to such
conditions as the State Bank may think fit to impose.
(2) Every banking company in
existence on the commencement of this Ordinance, before the expiry of six
months from such commencement, and every other company before commencing banking
business in Pakistan
Provided that nothing in sub-section
(1) shall be deemed to prohibit a banking company in existence on the
commencement of this Ordinance from carrying on banking business until it is
granted a licence in pursuance of this section or is by notice in writing
informed by the State Bank that a licence cannot be granted to it:
Provided further that the State Bank
shall not give a notice as aforesaid to a banking company in existence on the
commencement of this Ordinance before the expiry of the period of two years in
the case of banking companies incorporated in Pakistan Pakistan
(3) Before granting any licence under
this section, the State Bank may require to be satisfied by an inspection of the
books of the company or otherwise that all or any of the following conditions
are fulfilled, namely :—
(a) that the company is or will be in
a position to pay its present or future depositors in full as their claims
accrue;
(b) that the affairs of the company
are not being or are not likely to be conducted in a manner detrimental to the
interests of its present or future depositors;
(c) that, in the case of a company
incorporated outside Pakistan, the Government or law of the country in which it
is incorporated provides the same facilities to banking companies registered in
Pakistan as the Government or law of Pakistan grants to banking companies
incorporated outside Pakistan and that the company complies with all the
provisions of this Ordinance applicable to banking companies incorporated
outside Pakistan.
(4) The State Bank may cancel a
licence granted to a banking company under this section,—
(i) if the company ceases to carry on
banking business in Pakistan
(ii) if the company at any time fails
to comply with any of the conditions imposed upon it under sub-section (1) ; or
(iii) if at any time, any of the
conditions referred to in subsection (3) ceases to be fulfilled:
Provided that before canceling a
licence under clause (ii) or clause (iii) of this sub-section on the ground
that the banking company has failed to comply with or has failed or ceased to
fulfil any of the conditions referred to therein, the State Bank, unless it is
of opinion that the delay will be prejudicial to the interests of the companys
depositors or the public, shall grant to the company on such terms as it may
specify, an opportunity of taking the necessary steps for complying with or
fulfilling such condition.
(5) Any banking company aggrieved by
the decision of the State Bank canceling a licence under this section may,
within thirty days from the date on which such decision is communicated to it,
appeal to the Central Government.
(6) The decision of the Central Government where an appeal has been preferred
to it under sub-section (5) or of the State Bank where no such appeal has been
preferred shall be final.
28. Restrictions on opening of new, and transfer of existing, places of
business. —(1) No
banking company shall open a new place of business in any part of Pakistan or
change, otherwise than within the same city, town or village the location of an
existing place of business situated in any part of Pakistan and no banking
company incorporated in Pakistan shall open a new place of business outside
Pakistan or change, otherwise than within the same city, town or village in any
country or area outside Pakistan, the location of an existing place of business
situated in that country or area without first obtaining the prior permission
in writing of the State Bank.
(2) Nothing in this section shall
apply to the opening for a period not exceeding one month of a temporary place
of business within a city, town or village or the environs thereof within which
the banking company already has a place of business, for the purpose of
affording banking facilities to the public on the occasion of an exhibition, a
conference or a mela or any other like occasion:
Provided intimation of such opening
is given to the State Bank within one week of the date of opening.
Explanation.—For the purpose of this
section—
(a) “place of business” includes any
sub-office, pay-office, sub-pay office and any place of business at which deposits
are received, cheques cashed or moneys lent;
(b) “new place of business” includes
a place of business which is reopened after being temporarily closed.
(3) The State Bank may, before giving
the permission referred to in sub-section (1) of this section to any banking
company, require to be satisfied by an inspection under section 40 or otherwise
regarding such aspects of the companys affairs as the State Bank may deem
necessary.
29. Maintenance of liquid assets. —(1) Every banking company shall maintain in Pakistan
in cash, gold or unencumbered approved securities valued at a price not
exceeding the current market price, an amount which shall not at the close of
business on any day be less than twenty per cent of the total of its time and
demand liabilities in Pakistan.
Provided that the requirements of
sub-section (1) as to the maintenance in Pakistan
Explanation.—For the purposes of this
section, “unencumbered approved securities” of a banking company shall include
its approved securities lodged with another institution for an advance or any
other credit arrangement to the extent to which such securities have not been
drawn against or availed of.
(2) In computing the amount provided
for in sub-section (1), any deposit required under the proviso to sub-section
(3) of section 13 to be made with the State Bank by a banking company
incorporated outside Pakistan and any balances maintained in Pakistan by a
banking company in current account with the State Bank or its agent or both,
including in the case of a scheduled bank the balance required to be so
maintained under subsection (1) of section 36 of the State Bank of Pakistan
Act, 1956, shall be deemed to be cash maintained.
(3) Every banking company shall,
before the close of the month succeeding the month to which the return relates,
furnish to the State Bank a monthly return in the prescribed form and manner
showing particulars of the companys assets maintained in accordance with this
section and its time and demand liabilities in Pakistan at the close of
business on each Friday during the month, or if any Friday is a public holiday
under the Negotiable Instruments Act, 1881, at the close of business on the
preceding working day.
30. Assets in Pakistan
(2) Every banking company shall,
before the close of the month succeeding that to which the return relates,
furnish to the State Bank, in the prescribed form and manner a monthly return
showing particulars of the companys assets maintained in accordance with this
section and its time and demand liabilities in Pakistan at the close of
business on every Friday or if any Friday is a public holiday under the
Negotiable Instruments Act, 1881, at the
close of business on the preceding working day.
(3) For the purposes of this section—
(a) “assets in Pakistan” shall be
deemed to include export bills drawn in, and import bills drawn on and payable
in, Pakistan and expressed in such currencies as the State Bank may from time
to time approve in this behalf and also such securities as the State Bank may
approve in this behalf notwithstanding that all or any of the said bills or
securities are held outside Pakistan, but shall exclude such assets as in the
opinion of the State Bank cannot properly be regarded as assets;
(b) “liabilities in Pakistan
31. Return of unclaimed deposits. Every banking company shall, within
thirty days after the close of each calendar year, submit a return in the
prescribed form and manner to the State Bank as at the end of such calendar
year of all accounts in Pakistan which have not been operated upon for ten
years, giving particulars of the deposits standing to the credit of each such
account:
Provided that in the case of money
deposited for a fixed period the said term of ten years shall be reckoned from
the date of expiry of such fixed period.
32. Half-yearly returns and power to call for other returns and
information. — (1)
Every banking company shall, before the close of the month succeeding the
half-year to which the return relates submit to the State Bank a half-yearly
return in the prescribed form and manner showing its assets and liabilities in
Pakistan as they stood at the close of business on the thirtieth day of June in
the first half and the thirty-first day of December, in the second half of the
year.
(2) The State Bank may, at any time,
by notice in writing, require banking companies generally, or any banking
company in particular to furnish it within the time specified therein or such
further time as the State Bank may allow, with any statement or information
relating to the business or affairs of such banking company or companies
(including any business or affairs with which such banking company or companies
is or are concerned) and, without prejudice to the generality of the foregoing
power, may call for information, at such intervals as the State Bank may deem
necessary, regarding the investments of banking companies and the
classification of their advances in respect of industry, commerce and
agriculture.
33. Power to publish information. The State Bank, if it considers it in
the public interest so to do, may publish any information obtained by it under
this Ordinance in such consolidated form as it thinks fit.
34. Accounts and balance sheet. — (1) At the expiration of each calendar year every banking
company incorporated in Pakistan, in respect of all business transacted by it,
and every banking company incorporated outside Pakistan, in respect of all
business transacted through its brandies in Pakistan, shall prepare with
reference to that year a balance sheet and profit and loss account as on the
last working day of the year in the forms set out in the Second Schedule or as
near thereto as circumstances admit.
(2) The balance sheet and profit and
loss account shall be signed:—
(a) in the case of a banking company
incorporated in Pakistan, by the manager or the principal officer of the
company and where there are more than three directors of the company, by at
least three of those directors, or where there are not more than three
directors, by all the directors, and
(b) in the case of a banking company
incorporated outside Pakistan
by the manager or agent of the principal office of the company in Pakistan
(3) Notwithstanding that the balance
sheet of a banking company is under sub-section (1) required to be prepared in
a form other than the form marked F in the Third Schedule to the Companies Act,
1913, the requirements of that Act relating to the balance-sheet and profit and
loss account of a company shall, in so far as they arc not inconsistent with
this Ordinance, apply to the balance-sheet or profit and loss account, as the
case may be, of a banking company.
(4) The State Bank may, after giving
not less than three months notice of its intention so to do, from time to time
by a notification in the official Gazette, amend the forms set out in the
Second Schedule.
35. Audit. — (1)
The balance sheet and profit and loss account prepared in accordance with
section 34 shall be audited by a person duly qualified under Chartered
Accountants Ordinance, 1961, or any other law for the time being in force to be
an auditor of companies.
(2) The auditor shall have the powers
of, exercise the functions vested in, and discharge the duties and be subject
to the liabilities and penalties imposed on, auditors of companies by section
145 of the Companies Act, 1913.
(3) In addition to the matters which
under the aforesaid Act the auditor is required to state in his report, he
shall also state—
(a) whether or not the information and
explanations required by him have been found to be satisfactory;
(b) whether or not the transactions
of the company which have come to his notice have been within the powers of the
company;
(c) whether or not the returns
received from branch offices of the company have been found adequate for the
purposes of his audit;
(d) whether the profit and loss
account shows a true balance of profit and loss for the period covered by such
account;
(e) any other matter which he
considers should be brought to the notice of the shareholders of the company.
36. Submission of returns. The accounts and balance-sheet
referred to in section 34 together with the auditors report as passed in the
Annual General Meeting shall be published in the prescribed manner, and three
copies thereof shall be furnished as returns to the State Bank within three
months of the close of the period to which they relate:
Provided that the State Bank may in
special circumstances extend the said period of three months for the furnishing
of such returns by a further period not exceeding three months.
37. Copies of Balance sheets and accounts to be sent to registrar. Where a banking company in any year furnishes its
balance-sheet and accounts in accordance with the provisions of section 36 it
may, or when it is a private company, shall, at the same time send to the
registrar three copies of such balance-sheet and accounts and of the auditors
report, and where such copies are so sent, it shall not be necessary for the
company, to file copies of the balance sheet and accounts with the registrar as
required by sub-section (1) of section 134 of the Companies Act, 1913, and such
copies so sent shall be chargeable with the same fees and shall be dealt with
in all respects as if they were filed in accordance with that section.
38. Display of audited balance sheet by banking companies incorporated
outside Pakistan
39. Accounting Provisions of this Ordinance not retrospective. Nothing in this Ordinance shall apply to the preparation of
accounts by a banking company and the audit and submission thereof in respect
of any accounting year which has expired prior to the commencement of this Ordinance,
and notwithstanding the other provisions of this Ordinance such accounts shall
be prepared, audited and submitted in accordance with the law in force
immediately before the commencement of this Ordinance.
40. Inspection. — (1) Notwithstanding anything to the contrary contained in section 138 of
the Companies Act, 1913, the State Bank may, at any time, and, on being
directed so to do by the Central Government, shall, inspect any banking
company and its books and accounts.
(2) The inspection shall be carried
out by such officers of the State Bank as the State Bank may direct.
(3) The State Bank shall supply to
the banking company a copy of its report on the inspection made under this
section.
(4) It shall be the duty of every
director or other officer of the banking company to produce to any officer,
hereafter in this section called the inspecting officer, making an inspection
under this section, all such books, accounts and other documents in his custody
or power and to furnish him with such statements and information relating to the affairs of the
banking company and within such time as the inspecting officer may require.
(5) The inspecting officer may
examine on oath any director or other officer of the banking company in
relation to its business and may administer an oath accordingly.
(6) The State Bank shall, if it has
been directed by the Central Government to make an inspection, and, in any
other case, may, submit a report to the Central Government on any inspection
made under this section and the Central Government, if it is of opinion, after
considering the report that the affairs of the banking company are being
conducted to the detriment of the interests of its depositors, may, after
giving such opportunity to the banking company to make a representation in
connection with the report as, in the opinion of the Central Government, seems
reasonable, by order in writing—
(a) prohibit the banking company from
receiving fresh deposits;
(b) direct the State Bank to apply
under section 49 for the winding up of the banking company:
Provided that the Central Government
may defer, for such period as it may think fit, the passing of an order under
this subsection, or cancel or modify any such order, upon such terms and
conditions as it may think fit to impose.
(7) The Central Government, may,
after giving reasonable notice to the banking company, publish, on the advice
of the State Bank, the report submitted by the State Bank or such portion
thereof as may appear necessary to the Central Government.
Explanation.—For the purposes of this
section, the expression “banking company” shall include—
(i) in the case of a banking company
incorporated outside Pakistan ,
all its branches in Pakistan
(ii) in the case of a banking company
incorporated in Pakistan
(a) all its subsidiaries formed for
the purpose of carrying on the business of banking exclusively outside Pakistan
(b) all its branches whether situated
in Pakistan
outside Pakistan
41. Power of the state Bank to give directions. — (1) Where the State Bank is satisfied
that—
(a) in the public interest; or
(b) to prevent the affairs of any
banking company being conducted in a manner detrimental to the interests of the
depositors or in a manner prejudicial to the interests of the banking company;
or
(c) to secure the proper management
of any banking company generally;
it is necessary to issue directions
to banking companies generally or to any banking company in particular, it may,
from time to time, issue such directions as it deems fit, and the banking
companies or the banking company, as the case may be, shall be bound to comply
with such directions.
(2) The State Bank may, on
representation made to it or on its own motion, modify or cancel any direction
issued under subsection (1), and in so modifying or cancelling any direction
may impose such conditions as it thinks fit, subject to which the modification
or cancellation shall have effect.
42. Further powers and functions of the state Bank. — (1) The State Bank may—
(a) caution or prohibit banking
companies generally or any banking company in particular against entering into
any particular transaction or class of transactions, and generally give advice
to any banking company;
(b) require banking companies
generally, or any banking company in particular, to refrain from taking such
action as it may specify in relation to any matter relating to the business of
such banking company or companies, or to take such action in relation thereto
as the State Bank thinks fit;
(c) on a request from the banking
companies concerned and subject to the provisions of section 59 assist as
intermediary or otherwise, in proposals for the amalgamation of such Banking
companies;
(d) during the course, or after the
completion, of any inspection of a banking company under section 40, by order
in writing and on such terms and conditions as may be specified therein—
(i) require the banking company to
call a meeting of its directors for the purpose of considering any matter
relating to or arising out of the affairs of the banking company, or require an
officer of the banking company to discuss any such matter with an officer of
the State Bank;
(ii) depute one or more of its
officers to watch the proceedings at any meeting of the Board of Directors of
the banking company or of any committee or of any other body constituted by it;
require the banking company to give an opportunity to the officers so deputed
to be heard at such meetings and also require such officers to send a report of
such proceedings to the State Bank;
(iii) require the Board of Directors
of the banking company or any committee or any other body constituted by it to
give in writing to any officer specified by the State Bank in this behalf at
his usual address all notices of, and other communications relating to, any
meeting of the Board, committee or other body constituted by it;
(iv) appoint one or more of its
officers to observe the manner in which the affairs of the banking company or
of its offices or branches are being conducted and make a report thereon;
(v) require the banking company to
make, within snch time as may be specified in the order, such changes in the management
as the State Bank may consider necessary in consequence of the state of affairs
disclosed during or by the inspection.
(2) The State Bank shall make an
annual report to the Central Government on the trend and progress of banking in
the country, with particular reference to its activities under subsection (2)
of section 17 of the State Bank of Pakistan Act, 1956, including in such report
its suggestions, if any, for the strengthening of banking business throughout
the country.
43. Certain provisions of the Ordinance not to apply to certain banking
companies. — (1) The
provisions of section 13, sub-section (1) of section 14, and sections 21, 22,
29 and 30 shall not apply to a banking company—
(a) which has been refused a licence
under section 27, or prohibited from accepting fresh deposits by a compromise,
arrangement or scheme sanctioned by a court or by any order made in any
proceeding relating to such compromise, arrangement or scheme, or prohibited
from accepting deposits by virtue of any alteration made in its memorandum; or
(b) whose licence has been cancelled under section 27.
(2) Where the State Bank is satisfied
that any such banking company as is referred to in sub-section (1) has repaid,
or has made adequate provision for repaying all deposits accepted by the
banking company, either in full or to the maximum extent possible, the State
Bank may, by notice published in the official Gazette, notify that the banking
company has ceased to be a banking company within the meaning of this Ordinance,
and thereupon all the provisions of this Ordinance applicable to such banking
company shall cease to apply to it, except as respects things done or omitted
to be done before such notice.
PART III
SUSPENSION OF BUSINESS AND WINDING UP OF BANKING
COMPANIES.
44. High Court defined. In this Part and in Part IV “High
Court”, in relation to a banking company, means the High Court exercising
jurisdiction in the place where the registered office of the banking company
is situated or, in the case of a banking company incorporated outside Pakistan,
where its principal place of business in Pakistan is situated.
45. Restriction on stay order. — (1) The High Court may, on the application of a banking
company which is temporarily unable to meet its obligations make an order
staying for a fixed period on such terms and conditions as it may think fit
the commencement or continuance of all proceedings against the company and may
from time to time extend the period so however that the total period including
the period of any stay order granted under the proviso to sub-section (2),
shall not exceed six months.
(2) Except as hereinafter provided no
order of stay shall be granted upon such application unless it is accompanied
by a report of the State Bank showing that in the opinion of the State Bank the
banking company will be able to pay its debts if the application is granted:
Provided that in the case of an
application not so accompanied the High Court may, if it thinks fit, grant
stay for a period of not more than thirty days in the aggregate, and, if such
stay is granted, shall call for a report from the State Bank on the affairs of
the banking company, on receipt of which it may either rescind an order already
passed or pass such further orders as it may consider just and proper in the
circumstances.
(3) The High Court shall forward to
the State Bank a copy of every stay order made under this section.
(4) When an application is made under
sub-section (1), the High Court may appoint a special officer who shall forthwith
take into his custody or under his control all the assets, books, documents,
effects and actionable claims to which the banking company is or appears to be
entitled and shall also exercise such other powers as the High Court may deem
fit to confer on him, having regard to the interests of the depositors of the
banking company.
(5) Where the State Bank is satisfied
that the affairs of a banking company in respect of which an order under
sub-section (1) has been made, are being conducted in a manner detrimental to
the interests of the depositors, it may make an application to the High Court
for the winding up of the company, and where any such application is made, the
High Court shall not make any order extending the period for which the
commencement or continuance of all actions and proceedings against the company
were stayed under that sub-section.
(6) The special officer appointed by
the High Court under sub-section (4) of this section shall continue to hold
office until he is removed from office, or until the bank resumes business, or
until a liquidator is duly appointed to wind up the business of the bank.
46. Restriction on compromise or arrangement between banking companies
and creditors. — (1)
Notwithstanding anything contained in any law for the time being in force, no
High Court shall sanction a compromise or arrangement between a banking
company and its creditors or any class of them or between such company and its
members or any class of them unless the compromise or arrangement is certified
by the State Bank in writing as not being incapable of being worked and as not
being detrimental to the interests of the depositors of such banking company.
(2) Where an application under
section 153 of the Companies of Act, 1913, is made in respect of a banking
company, the High 3, Court may direct the State Bank to make an inquiry in
relation to the affairs of the banking company and the conduct of its directors
and when such a direction is given, the State Bank shall make such inquiry and
submit its report to the High Court.
47. Power of state bank to apply to central Government for suspension of
business by a banking company and to prepare scheme of reconstruction or
amalgamation. — (1) Notwithstanding anything
contained in the provisions of this Part or in any other law or any agreement
or other instrument, for the time being in force, where it appears to the State
Bank that there is good reason so to do, the State Bank may apply to the
Central Government for an order of moratorium in respect of a banking company.
(2) The Central Government, after
considering the application made by the State Bank under sub-section (1), may
make an order of moratorium staying the commencement or continuance of all
action and proceedings against the company for a fixed period of time on such
terms and conditions as it thinks fit and proper and may from time to time
extend the period so however that the total period of moratorium shall not
exceed six months.
(3) Except as otherwise provided by
any directions given by the Central Government in the order made by it under
sub-section (2) or at any time thereafter, the banking company shall not during
the period of moratorium make any payment to any depositors or discharge any
liabilities or obligations to any other creditors.
(4) During the period of moratorium,
if the State Bank is satisfied that—
(a) in the public interest; or
(b) in the interests of the
depositors; or
(c) in order to secure the proper
management of the banking company; or
(d) in the interests of the banking system
of the country as a whole,
it is necessary so to do, the State
Bank may prepare a scheme—
(i) for the reconstruction of the
banking company, or
(ii) for the amalgamation of the
banking company with any other banking institution (in this section referred to
as the transferee bank”).
(5) The scheme aforesaid may contain
provisions for all or
any of the following matters,
namely:—
(a) the constitution, name and
registered office, the capital, assets, powers, rights, interests, authorities and privileges, the liabilities,
duties and obligations, of the banking company on its reconstruction or, as the
case may be, of the transferee bank;
(b) in the case of amalgamation of
the banking company, the transfer to the transferee bank of the business,
properties, assets and liabilities of the banking company on such terms and
conditions as may be specified in the scheme;
(c) any change in the Board of
Directors, or the appointment of a new Board of Directors, of the banking
company on its reconstruction or, as the case may be, of the transferee bank
and the authority by whom, the manner in which, and the other terms and conditions
on which, such change or appointment shall be made and in the case of
appointment of a new Board of Directors or of any director, the period for
which such appointment shall be made;
(d) the alteration of the memorandum
and articles of association of the banking company on its reconstruction or,
as the case may be, of the transferee bank for the purpose of altering the
capital thereof or for such other purposes as may be necessary to give effect
to the reconstruction or amalgamation;
(e) subject to the provisions of the
scheme, the continuation by or against the banking company on its reconstruction
or, as the case may be, the transferee bank, of any actions or proceedings
pending against the banking company immediately before the date of the order of
moratorium;
(f) the reduction of the interest or
rights which the members, depositors and other creditors have in or against
the banking company before its reconstruction or amalgamation to such extent as
the State Bank considers necessary in the public interest or in the interests
of the members, depositors and other creditors or for the maintenance of the
business of the banking company;
(g) the payment in cash or otherwise
to depositors and other creditors in full satisfaction of their claim—
(i) in respect of their interest or
rights in or against the banking company before its reconstruction or
amalgamation; or
(ii) where their interest or rights
aforesaid in or against the banking company has or have been reduced under
clause (/), in respect of such interest or rights as so reduced;
(h) the allotment to the members of
the banking company for shares held by them therein before its reconstruction
or amalgamation, whether their interest in such shares has been reduced under
clause (f) or not, of shares in the banking company on its reconstruction or,
as the case may be, in the transferee bank and where any members claim payment
in cash and not allotment of shares, or where it is not possible to allot
shares to any members, the payment in cash to those members in full
satisfaction of their claim—
(i) in respect of their interest in
shares in the banking company before its reconstruction or amalgamation; or
(ii) where such interest has been
reduced under clause (/), in respect of their interest in shares as so reduced;
(f) the continuance of the services
of all the employees of the banking company, excepting such of them who, not
being workmen within the meaning of the Industrial Disputes Ordinance, 1959,
are specifically mentioned in the scheme, in the banking company itself on its
reconstruction or, as the case may be, in the transferee bank at the same
remuneration and on the same terms and conditions of service, which they were
getting or, as the case may be, by which they were being governed, immediately
before the date of the order of moratorium:
Provided that the scheme shall
contain a provision that—
(i) the banking company shall pay or
grant not later than the expiry of the period of three years from the date on
which the scheme is sanctioned by the Central Government, to the said employees
the same remuneration and the same terms and conditions of service as are
applicable to employees of corresponding rank or status of a comparable banking
company to be determined for this purpose by the State Bank whose
determination in this respect shall be final;
(ii) the transferee bank shall pay or
grant not later than the expiry of the aforesaid period of three years, to the
said employees the same remuneration and the same terms and conditions of
service as are applicable to the other employees of corresponding rank or
status of the transferee bank subject to the qualifications and experience of
the said employees being the same as or equivalent to those of such other
employees of-the transferee bank:
Provided further that if in any case
under clause (ii) of the first proviso any doubt or difference arises as to
whether the qualification and experience of any of the said employees are the
same as or equivalent to the qualifications and experience of the other
employees of corresponding rank or status of the transferee bank, the doubt or
difference shall be referred to the State Bank whose decision thereon shall be
final;
(j) notwithstanding anything
contained in clause (i) where any of the employees of the banking company, not
being workman within the meaning of the Industrial Disputes Ordinance, 1959,
are specifically mentioned in the scheme under clause (;), or where any
employees of the banking company have by notice in writing given to the banking
company or, as the case may be, the transferee bank at any time before the
expiry of one month next following the date on which the scheme is sanctioned
by the Central Government, intimated their intention of not becoming employees
of the banking company on its reconstruction or, as the case may be, of the
transferee bank, the payment to such employees of compensation, if any, to
which they are entitled under the Industrial Disputes Ordinance, 1959, and such
pension, gratuity, provident fund and other retirement benefits ordinarily
admissible to them under the rules or authorizations of the banking company
immediately before the date of the order of moratorium;
(k) any other terms and conditions
for the reconstruction or amalgamation of the banking company ;
(l) such incidental, consequential and supplemental matters as arc
necessary to secure that the reconstruction or amalgamation shall be fully and
effectively carried out.
(6) A copy of the scheme prepared by
the State Bank shall be sent in draft to the banking company and also to the
transferee bank and any other banking company concerned in the amalgamation,
for suggestions and objections, if any, within such period as the State Bank
may specify for this purpose.
(7) The State Bank may make such
modifications, if any, in the draft scheme as it may consider necessary in the
light of the suggestions and objections received from the banking company and
also from the transferee bank, and any other banking company concerned in the
amalgamation and from any members, depositors or other creditors of each of
those companies and the transferee bank.
(8) The scheme shall thereafter be
placed before the Central Government for its sanction and the Central
Government may sanction the scheme without any modifications or with such modifications
as it may consider necessary; and the scheme as sanctioned by the Central
Government shall come into force on such date as the Central Government may
specify in this behalf :
Provided that different dates may be
specified for different provisions of the scheme.
(9) Upon the coming into operation of
the scheme or any provision thereof, the scheme or such provision shall be
binding on the banking and any other banking company concerned in the
amalgamation and also company or, as the case may be, on the transferee bank
and any other banking company concerned in the amalgamation and also on all
the members, depositors and other creditors and employees of each of those
companies and of the transferee bank, and on any other person having any right
or liability in relation to any of those companies or the transferee bank.
(10) On such date as may be specified
by the Central Government in this behalf, the properties and assets of the
banking company shall, by virtue of and to the extent provided in the scheme,
stand transferred to, and vest in, and the liabilities of the banking company
shall, by virtue of and to the extent provided in the scheme, stand
transferred to, and become the liabilities of, the transferee bank.
(11) If any difficulty arises in
giving effect to the provisions of the scheme, the Central Government may by
order do anything not inconsistent with such provisions which appears to it
necessary or expedient for the purpose of removing the difficulty.
(12) Copies of the scheme or of any
order made under subsection (11) shall be laid on the table of the
Legislature, as soon as may be, after the scheme has been sanctioned by the
Central Government, or as the case may be, the order has been made.
(13) Where the scheme is a scheme for
amalgamation of the banking company, any business acquired by the transferee
bank under the scheme or under any provision thereof shall, after the coming
into operation of the scheme or such provision, be carried on by the transferee
bank in accordance with the law governing the transferee bank, subject to such
modifications in that law or such exemptions of the transferee bank from the
operation of any provisions thereof as the Central Government, on the recommendation
of the State Bank, may, by notification in the official Gazette, make for the
purpose of giving full effect to the scheme:
Provided that no such modification or
exemption shall be made so as to have effect for a period of more than seven
years from the date of the acquisition of such business.
(14) Nothing in this section shall be
deemed to prevent the amalgamation with a banking institution by a single
scheme of several banking companies in respect of each of which an order of
moratorium has been made under this section.
(15) The provisions of this section
and of any scheme made under it shall have effect notwithstanding anything to
the contrary contained in any other provisions of this Ordinance or in any
other law or any agreement, award or other instrument for the time being in
force.
(16) In this section, “banking
institution” means any banking company and includes the National Bank of Pakistan
48. Procedure for amalgamation of banking companies. —(1) Notwithstanding anything
contained in any law for the time being in force, no banking company shall be
amalgamated with another banking company, unless a scheme containing the
terms of such amalgamation has been placed in draft before the shareholders of
each of the banking companies concerned separately, and approved by a
resolution passed by a majority in number representing two thirds in value of
the shareholders of each of the said companies, present either in person or by
proxy at a meeting called for the purpose.
(2) Notice of every such meeting as
is referred to in sub-section (1) shall be given to every shareholder of each
of the banking companies concerned in accordance with the relevant articles of
association, indicating the time, place and object of the meeting, and shall
also be published at least once a week for three consecutive weeks in not less
than two newspapers which circulate in the locality or localities where the
registered offices of the banking companies concerned are situated, one of
such newspapers being in a language commonly understood in thc locality or
localities.
(3) Any shareholder, who has voted
against the scheme of amalgamation at the meeting or has given notice in
writing at or prior to the meeting to the company concerned or the presiding
officer of the meeting that he dissents from the scheme of amalgamation, shall
be entitled, in the event of the scheme being sanctioned by the State Bank to
claim from the banking company concerned, in respect of the shares held by him
in that company, their value as determined by the State Bank when sanctioning
the scheme and such determination by the State Bank as to the value of the
shares to be paid to the dissenting shareholder shall be final for all
purposes.
(4) If the scheme of amalgamation is
approved by the requisite majority of shareholders in accordance with the
provisions of this section, it shall be submitted to the State Bank for sanction
and shall, if sanctioned by the State Bank by an order in writing passed in
this behalf be binding on the banking companies concerned and also on all the
shareholders thereof.
(5) Where a scheme of amalgamation is
sanctioned by the State Bank under the provisions of this section, the State Bank
shall transmit a copy of the order sanctioning the scheme to the registrar
before whom the banking companies concerned have been registered and the
registrar shall, on receipt of any such order, strike off the name of the
company thereinafter in this section referred to as the amalgamated banking
company) which by reason of the amalgamation will cease to function.
(6) On the sanctioning of a scheme of
amalgamation by the State Bank, the property of the amalgamated banking company
shall, by virtue of the order of sanction, be transferred to and vest in, and
the liabilities of the said company shall, by virtue of the said order be
transferred to and become the liabilities of the banking company which under
the scheme of amalgamation is to acquire the business of the amalgamated
banking company, subject in all cases to the terms of the order sanctioning the
scheme.
49. Winding up by High court. — (1) Notwithstanding anything
contained in section 153, section 162 and section 271 of the Companies Act,
1913, but without prejudice to its powers under sub-section (1) of section 45
of this Ordinance, the High Court shall order the winding up of a banking
company—
(a) if the banking company is unable
to pay its debts ; or
(b) if an application for its winding
up has been made by the State Bank under section 45 or this section.
(2) The State Bank shall make an
application under this section for the winding up of a banking company if it
is directed so to do by an order under clause (6) of sub-section (6) of section
40.
(3) The State Bank may make an
application under this section for the winding up of a banking company—
(a) if the banking company—
(i) has failed to comply with the
requirements specified in section 13 ; or
(ii) has by reason, of the provisions
of section 27 become disentitled to carry on banking business in Pakistan
(iii) has been prohibited from
receiving fresh deposits by an order under clause (a) of sub-section (6) of
section 40, or under clause (b) of sub-section (5) of section 36 of the State
Bank of Pakistan Act, 1956 ; or
(iv) having failed to comply with any
requirement of this Ordinance other than the requirements laid down in section
13, has continued such failure, or, having contravened any provision of this Ordinance
has continued such contravention beyond such period or periods as may be
specified in that behalf by the State Bank from time to time, after notice in
writing of such failure or contravention has been conveyed to the banking
company ; or
(b) if in the opinion of the State
Bank—
(i) a compromise or arrangement
sanctioned by a Court in respect of the banking company cannot be worked
satisfactorily with or without modifications ; or
(ii) the returns, statements or
information furnished to it under or in pursuance of the provisions of this Ordinance
disclose that the banking company is unable to pay its debts ; or
(iii) the continuance of the banking
company is prejudicial to the interests of its depositors.
(4) Without prejudice to the
provisions contained in section 163 of the Companies Act, 1913, a banking
company shall be deemed to be unable to pay its debts if it has refused to meet
any lawful demand made at any of its offices or branches within two working
days, if such demand is made at a place where there is an office, branch or
agency of the State Bank, or within five working days, if such demand is made
elsewhere, and if the State Bank certifies in writing that the banking company
is unable to pay its debts.
(5) A copy of every application made
by the State Bank under sub-section (1) shall be sent by the State Bank to the
registrar.
(6) Notwithstanding anything
contained in the Companies Act, 1913, no Court shall entertain an application
for winding up of a banking company by the Court unless such application is
accompanied by a certificate in writing from the State Bank certifying that it
has no objection to the making of such application.
50. Court Liquidator. — (1) When, having regard to the number of proceedings for the
winding up of banking companies or the extent of the work involved in such
proceedings, in any Province or at any place in any Province, the Central
Government is of the opinion that it is necessary or expedient to attach a
Court Liquidator to the High Court of that province it may, in consultation with
the State Bank, appoint a Court Liquidator, for the Province or at a place in
the Province, and for such time as the Central Government may think fit, for
the purpose of conducting all proceedings for the winding up of banking
companies and performing such duties in reference thereto as the High Court may
impose.
(2) Where there is a court liquidator
attached to a High Court and an order is passed by the High Court for the
winding up of any banking company, then, notwithstanding anything contained in
section 171A or section 175 of the Companies Act, 1913, the court liquidator
shall become the official liquidator of the banking company.
(3) Where there is a court liquidator
attached to a High Court and any proceeding, for the winding up of a banking
company in which any person other than the State Bank or the court liquidator
has been appointed as official liquidator, is pending before the High Court
immediately before the commencement of this Ordinance or the date on which the
court liquidator is so attached to the High Court, whichever is later, then,
notwithstanding anything contained in section 176 of the Com-f panics Act,
1913, the person appointed as official liquidator shall, on such commencement
or, as the case may be, on the aforesaid date, be deemed to have vacated his
office as such and the vacancy so caused shall be deemed to be filled up by the
appointment of the court liquidator as the official liquidator:
Provided that where the High Court,
after giving the Court liquidator and the State Bank an opportunity of being
heard, is of opinion that the appointment of the court liquidator would be
detrimental to the interests of the depositors of the banking company, it may
direct the person appointed as the official liquidator to continue to act as
such.
51. State Bank to be official liquidator.
Notwithstanding
anything contained in section 50, of or in section 175 of the Companies Act,
1913, where in any proceeding for the winding up of a banking company by the
High Court the State Bank applies for an order appointing the State Bank or any
individual as the official liquidator of the banking company in that
proceeding, the application shall
ordinarily be granted and the liquidator, if any, functioning in such
proceeding shall vacate office upon such appointment.
52. Application of companies Act to liquidateors. — (1) All the provisions of the
Companies Act, 1913, 13. relating to a liquidator, and so far as they are not
inconsistent with this Ordinance, shall
apply to or in relation to a liquidator appointed under section 50 or section
51.
(2) Any reference to the “official
liquidator” in this Part and Part IV shall be construed as including a
reference to any liquidator of a banking company.
53. Stay of proceedings. Notwithstanding anything to the
contrary contained of in section 173 of the Companies Act, 1913, the High Court
shall not make any order staying the proceedings in relation to the winding up
of a banking company, unless the High Court is satisfied that an arrangement
has been made whereby the company can pay its depositors in full as their
claims accrue,
54. Preliminary report by official liquidator. Notwithstanding anything to the contrary contained in section
177B of the Companies Act, 1913, where a winding-up order has been made in
respect of a banking company whether before or after the commencement of this Ordinance,
the official liquidator shall submit a preliminary report to the High Court
within two months from the date of the winding-up order or where the winding-up
order has been made before such commencement, within two months from such
commencement, giving the information required by that section so far as it is
available to him and also stating the amount of assets of the banking company
in cash which are in his custody or under his control on the date of the report
and the amount of its assets which are likely to be collected in cash before
the expiry of that period of two months in order that such assets may be
applied speedily towards the making of preferential payments under section 230
of the Companies Act, 1913 and in the discharge, as far as possible, of the
liabilities and obligations of the banking company to its depositors and other
creditors in accordance with the provisions hereinafter contained; and the
official liquidator shall make for the purposes aforesaid every endeavour to
collect in cash as much of the assets of the banking company as practicable:
Provided that the High Court may, if
it thinks fit in any particular case, extend the period of two months referred
to in this section by a further period of one month.
55. Notice to preferential claimants and secured and unsecured creditors.
— (1) Within fifteen
days from the date of the winding-up order of a banking company or where the
winding-up order has been made before the commencement of this Ordinance,
within one month from such commencement, the official liquidator shall, for
the purpose of making an estimate of the debts and liabilities of the banking
company (other than its liabilities and obligations to its depositors), by
notice served in such manner as the State Bank may direct, call upon—
(a) every claimant entitled to
preferential payment under section 230 of the Companies Act, 1913, and
(b) every secured and every unsecured
creditor, to send to the official liquidator within one month from the date of
the service of the notice a statement of the amount claimed by him.
(2) Every notice under sub-section
(1) sent to a claimant having a claim under section 230 of the Companies Act,
1913, shall state that if a statement of the claim is not sent to the official
liquidator before the expiry of the period of one month from the date of the
service, the claim shall not be treated as a claim entitled to be paid under
that section in priority to all other debts but shall be treated as an ordinary
debt due by the banking company.
(3) Every notice under sub-section
(1) sent to a secured creditor shall require him to value his security before
the expiry of the period of one month from the date of the service of the
notice and shall state that if a statement of the claim together with the
valuation of the security is not sent to the official liquidator before the
expiry of the said period, then the official liquidator shall himself value
the security and such valuation shall be binding on the creditor.
(4) If a claimant fails to comply
with the notice sent to him under sub-section (1), his claim will not be
entitled to be paid under section 230 of the Companies Act, 1913, in priority
to all } other debts but shall be treated as an ordinary debt due by
the banking company; and if a secured creditor fails to comply with the notice
sent to him under sub-section (1), the official liquidator shall himself value
the security and such valuation shall be binding on the creditor.
56. Power to dispense with meetings of creditors, etc. Notwithstanding anything to the contrary contained , in
sections 178-A and 183 of the Companies Act, 1913, the High 3. Court may, in
the proceedings for winding-up a banking company, dispense with any meetings
of creditors or contributories or with the appointment of a committee of
inspection if it considers that no object will be secured thereby sufficient
to justify the delay and expense.
57. Booked depositors credits to be deemed proved. In any proceeding for the winding-up of a banking company,
every depositor of the banking company shall be deemed to have filed his claim
for the amount shown in the books of the banking company as standing to his
credit and, notwithstanding anything to the contrary contained in section of
191 of the Companies Act, 1913, the High Court shall presume. such claim to
have been proved, unless the official liquidator shows that there is reason for
doubting its correctness.
58. Preferential payments to depositors. — (1) In every proceeding for the
winding-up of a banking company where a winding-up order has been made,
whether before or after the commencement of this Ordinance, within three months
from the date of the winding-up order or where the winding-up order has been
made before such commencement, within three months therefrom, the preferential
payments referred to in section 230 of the Companies Act, 1913, in respect of
which statements of claims have been sent within one month from the date of the
service of the notice referred to in section 55, shall be made by the official
liquidator or adequate provision for such payments shall be made by him.
(2) After the preferential payments
as aforesaid have been made or adequate provision has been made in respect
thereof, there shall be paid within the aforesaid period of three months—
(a) in the first place, to every
depositor in the savings bank account of the banking company a sum of two
hundred and fifty rupees or the balance at his credit, whichever is less; and
(b) in the next place, to every other
depositor of the banking company fifty per cent. of the balance at his credit
subject to a maximum of two hundred and fifty rupees, in priority to all other
debts from out of the remaining assets of the banking company available for
payment to general creditors:
Provided that the sum total of the
amounts paid under clause (a) and clause (b) to any one person who in his own
name (and not jointly with any other person) is a depositor in the savings bank
account of the banking company and also a depositor in any other account,
shall not exceed the sum of two hundred and fifty rupees.
(3) Where within the aforesaid period
of three months full payment cannot be made of the amounts required to be paid
under clause (c) or clause (b) of sub-section (2) with the assets in cash, the
official liquidator shall pay within that period to every depositor under
clause (a) or, as the case may be, clause (b) of that sub-section on a pro rata
basis so much of the amount due to the depositor under that clause as the
official liquidator is able to pay with those assets; and shall pay the rest of
that amount to every such depositor as and when sufficient assets are collected
by the official liquidator in cash.
(4) After payments have been made
first to depositors in the savings bank account and then to the other
depositors in accordance with the foregoing provisions, the remaining assets of
the banking company available for payment to general creditors shall be
utilised for payment on a pro rata basis of the debts of the general creditors;
and of the further sums, if any, due to the depositors; and after making
adequate provision for payment on a pro rata basis as aforesaid of the debts of
the general creditors, the official liquidator shall, as and when the assets of
the company are collected in cash, make payment on a pro rata basis as
aforesaid, of the further sums, if any, which may remain due to the depositors
referred to in clause (a) and clause (b) of sub-section (2).
(5) In order to enable the official
liquidator to have in his custody or under his control in cash as much of the
assets of the banking company as possible, the securities given to every
secured creditor may be redeemed by the official liquidator—
(a) where the amount due to the
creditor is more than the value of the securities as assessed by him or, as the
case may be, as assessed by the official liquidator, on payment of such value;
and
(b) where the amount due to the
creditor is equal to or less than the value of the securities as so assessed,
on payment of the amount due:
Provided that where the official
liquidator is not satisfied with the valuation made by the creditor, he may
apply to the High Court for making a valuation.
(6) When any claimant, creditor or
depositor to whom any payment is to be made in accordance with the foregoing
provisions, cannot be found or is not readily traceable, adequate provision
shall be made by the official liquidator for such payment.
(7) For the purposes of this section,
the payments specified in each of the following clauses shall be treated as
payments of a different class, namely:—
(a) payments to preferential
claimants under section 230 of the Companies Act, 1913;
(b) payments under clause (a) of
sub-section (2) to the depositors in the savings bank account;
(c) payments under clause (b) of
sub-section (2) to the other depositors;
(d) payments to the general creditors
and payments to the depositors in addition to those specified in clause (a) and
clause (b) of sub-section (2).
(8) The payments of each different
class specified in subsection (7) shall rank equally among themselves and be
paid in full unless the assets are insufficient to meet them, in which case
they shall abate in equal proportion.
59. Restriction on voluntary winding up.
Notwithstanding
anything to the contrary contained in section 203 of the Companies Act, 1913,
no banking company which holds a licence granted under section 27 may be
voluntarily wound up unless the State Bank certifies in writing that the
company is able to pay in full all its debts to its creditors as they accrue,
and without prejudice to the provisions contained in sections 218 and 220 of
that Act, the High Court shall, on application of the State Bank, order the
winding up of the company by the High Court if at any stage during the
voluntary winding up proceedings the company is not able to meet such debts as
they accrue.
PART IV
SPECIAL
PROVISIONS FOR SPEEDY DISPOSAL OF WINDING UP
PROCEEDINGS.
60. Part IV to override other laws.
The provisions
of this Part and the rules made thereunder shall have effect notwithstanding
anything inconsistent therewith contained in the Companies Act, 1913, or the
Code of Civil Procedure, 1908, or the Code of Criminal Procedure, 1898, or any
other law for the time being in force or any instrument having effect by
virtue of any such law; but the provisions of any such law or instrument in so
far as the same are not varied by, or inconsistent with, the provisions of this
Part or rules made thereunder shall apply to all proceedings under this Part.
61. Power of High court to decide all claims in respect of banking
companies. The High Court shall, save as
otherwise expressly provided in section 62, have exclusive jurisdiction to
entertain and decide any claim made by or against a banking company which is
being wound up (including claims by or against any of its branches in Pakistan)
or any application made under section 153 of the companies Act, 1913, by or in
respect of a banking company or any question of priorities or any other
question whatsoever, whether of law or fact, which may relate to or arise in
the course of the winding up of a banking company, whether such claim or
question has arisen or arises or such application has been made or is made
before or after the date of the order for the winding up of the banking company
or before or after the commencement of this Ordinance.
62. Transfer of pending proceedings.
— (1) Where a
winding up order is made or has been made in respect of a banking company, no
suit or other legal proceeding, whether civil or criminal, in respect of which
the High Court has jurisdiction under this Ordinance and which is pending in
any other court immediately before the commencement of this Ordinance or the
date of the order for the winding up of the banking company, whichever is
later, shall be proceeded with except in the manner hereinafter provided.
(2) The official liquidator shall,
within three months from the date of the winding up order or the commencement
of this Ordinance whichever is later or such further time as the High Court may
allow, submit to the High Court a report containing a list of all such pending
proceedings together with particulars thereof.
(3) On receipt of a report under
sub-section (2), the High Court may, if it so thinks fit, give the parties
concerned an opportunity to show cause why the proceedings should not be
transferred to itself and after making an inquiry in such manner as may be
provided by rules made under section 79, it shall make such order as it deems
fit transferring to itself all or such of the pending proceedings as may be
specified in the order and such proceedings shall thereafter be disposed of by
the High Court.
(4) If any proceeding pending in a
court is not so transferred to the High Court under sub-section (3), such
proceeding shall be continued in the court in which the proceeding was pending.
(5) Nothing in this section shall
apply to any proceeding pending in appeal before the Supreme Court or a High
Court.
63. Settlement of list of debtors. — (1) Notwithstanding anything to the contrary contained
in any law for the time being in force, the High Court may settle in the manner
hereinafter provided a list of debtors of a banking company which is being
wound up.
(2) Subject to any rules that may be
made under section 92, the official liquidator shall, within six months from
the date of the winding up order or the commencement of this Ordinance,
whichever is later, from time to time, file to the High Court lists of debtors
containing such particulars as are specified in the Third Schedule:
Provided that such lists may, with
the leave of the High Court, be filed after the expiry of the said period of
six months.
(3) On receipt of any list under
sub-section (2), the High Court shall, wherever necessary, cause notices to be
issued on all persons affected and after making an inquiry in such manner as
may be provided by rules made under section 79, it shall make an order settling
the list of debtors:
Provided that nothing in this section
shall debar the High Court from settling any such list in part as against such
of the persons whose debts have been settled without settling the debts of all
the persons placed on the list.
(4) At the time of the settlement of
any such list, the High Court shall pass an order for the payment of the amount
due by each debtor and make such further orders as may be necessary in respect
of the relief claimed, including reliefs against any guarantor or in respect of
the realisation of any security.
(5) Every such order shall, subject
to the provisions for appeal, be final and binding for all purposes as between
the banking company on the one hand and the person against whom the order is
passed and all persons claiming through or under him on the other hand, and
shall be deemed to be a decree in a suit.
(6) In respect of every such order,
the High Court shall issue a certificate specifying clearly the reliefs granted
and names and descriptions of the parties against whom such reliefs have been
granted, the amount of costs awarded and by whom, and out of what funds and in
what proportions, such costs are to be paid; and every such certificate shall
be deemed to be a certified copy of the decree for all purposes including
execution.
(7) At the time of settling the list
of debtors or at any other time prior or subsequent thereto, the High Court
shall have power to pass any order in respect of a debtor on the application of
the official liquidator for the realisation, management, protection,
preservation or sale of any property given as security to the banking company
and to give such powers to the official liquidator to carry out the aforesaid
directions as the High Court thinks fit.
(8) The High Court shall have power
to sanction a compromise in respect of any debt and to order the payment of
any debt by installments.
(9) In any case in which any such
list is settled expert as against any person, such person may, within thirty
days from the date of the order settling the list, apply to the High Court for
an order to vary such list, so far as it concerns him, and if the High Court is
satisfied that he was prevented by any sufficient cause from appearing on the
date fixed for the settlement of such list and that he has a good defence to
the claim of the banking company on merits, the High Court may vary the list
and pass such orders in relation thereto as it thinks fit:
Provided that the High Court may, if
it so thinks fit, entertain the application after the expiry of the said
period of thirty days.
(10) Nothing in this section shall—
(a) apply to a debt which has been
secured by a mortgage of immovable property, if a third party has any interest
in such immovable property; or
(b) prejudice the rights of the
official liquidator to recover any debt due to a banking company under any
other law for the time being in force.
64. Special provisions to make calls on contributories. Notwithstanding that the list of contributories has not been
settled under section 184 of the Companies Act, 1913, the High Court may, if it
appears to it necessary or expedient so to do, at any time after making a
winding up order, make a call on and order payment thereof by any contributory
under sub-section (1) of section 187 of the Companies Act, 1913, if such contributory
has been placed on the list of contributories by the official liquidator and
has not appeared to dispute his liability.
65. Documents of banking company to be evidence. — (1) Entries in the books of account or other documents of a
banking company which is being wound up shall be admitted in evidence in all
proceedings by or against the banking company;
and all such entries may be proved
either by the production of the books of account or other documents of the
banking company containing such entries or by the production of a copy of the entries,
certified by the official liquidator under his signature and stating that it is
a true copy of the original entries and that such original entries are
contained in the books of account or other documents of the banking company in
his possession.
(2) Notwithstanding anything to the
contrary contained in the Evidence Act, 1872, all such entries in the books of
account or other documents of a banking company shall as against the directors
of the banking company in respect of which the winding up order has been made
before the commencement of this Ordinance, be prima facie evidence of the truth
of all matters purporting to be therein recorded.
66. — (1)
Where an order has been made for the winding up of a banking company, the
official liquidator shall submit a report whether in his opinion any loss has
been caused to the banking company since its formation by any act or omission
(whether or not a fraud has been committed by such act or omission) of any
person in the promotion or formation of the banking company or of any director
or auditor of the banking company.
(2) If, on consideration of the
report submitted under subsection (1), the High Court is of opinion that any
person who has taken part in the promotion or formation of the banking company
or has been a director or an auditor of the banking company should be publicly
examined, it shall hold a public sitting on a date to be appointed for that
purpose and direct that such person, director or auditor shall attend thereat
and shall be publicly examined as to the promotion or formation or the conduct
of the business of the banking company, or as to his conduct and dealings, in
so far as they relate to the affairs of the banking company:
Provided that no such person shall be
publicly examined unless he has been given an opportunity to show cause why he
should not be so examined.
(3) The official liquidator, shall
take part in the examination and for that purpose may, if specially authorized
by the High Court in that behalf, employ such legal assistance as may be
sanctioned by the High Court.
(4) Any creditor or contributory may
also take part in the examination either personally or by any person entitled
to appear before the High Court.
(5) The High Court may put such
questions to the person examined as it thinks fit.
(6) The person examined shall be
examined on oath and shall answer all such questions as the High Court may put
or allow to be put to him.
(7) A person ordered to be examined
under this section may, at his own cost, employ any person entitled to appear
before the High Court who shall be at liberty to put to him such questions as
the High Court may deem just for the purpose of enabling him to explain or
qualify any answer given by him:
Provided that if he is, in the
opinion of the High Court, exculpated from any charges made or suggested
against him, the | High Court may allow him such costs in its discretion as it
may deem fit.
(8) Notes of the examination shall be
taken down in writing, and shall be read over to or by, and signed by, the
person examined and may thereafter be used in evidence against him in any
proceeding, civil or criminal, and shall be open to the inspection of any
creditor or contributory at all reasonable times.
(9) Where on such examination, the
High Court is of opinion (whether a fraud has been committed or not)—
(a) that a person who has been a
director of the banking company is not fit to be a director of a company, or
(A) that a person who has been an
auditor of the banking company or a partner of a firm acting as such auditor is
not fit to act as an auditor of a company or to be a partner of a firm acting
as such auditor,
the High Court may make an order that
that person shall not, without the leave of the High Court, be a director of,
or in any way, whether directly or indirectly, be concerned or take part in the
management of any company or, as the case may be, act as an auditor of, or be a
partner of a firm acting as auditors of, any company for such period not
exceeding five years as may be specified in the order.
67. Special provisions for assessing damages against delinquent
directors, etc. — (1)
Where an application is made to the High Court , under section 235 of the
Companies Act, 1913, against any promoter, director, manager, liquidator or
officer of a banking company for repayment or restoration of any money or
property and the applicant makes out a prima facie case against such person,
the High Court shall make an order against such person to repay and restore the
money or property unless he proves that he is not liable to make the repayment
or restoration either wholly or in part:
Provided that where such an order is
made jointly against two or more such persons, they shall be jointly and
severally liable to make the repayment or restoration of the money or property.
(2) Where an application is made to
the High Court under , section 235 of the Companies Act, 1913, and the High
Court has reason to believe that a property belongs to any promoter, director,
manager, liquidator or officer of the banking company, whether the property
stands in the name of such person or of any other person as the ostensible
owner, the High Court may, at any time, whether before or after making an order
under sub-section (1), direct that attachment of such property or of such portion
thereof as the High Court may think fit, and when the property so attached
stands in the name of an ostensible owner, it shall remain subject to
attachment unless the ostensible owner can prove to the satisfaction of the
High Court that he is the real owner and the provisions of the Code of Civil
Procedure, 1908, relating to attachment of property shall, as far as may be,
apply to such attachment.
68. Duty of directors and officers of banking company to assist in the
realisation of property. Every director or other officer of a
banking company which is being wound up shall give such assistance to the
official liquidator as he may reasonably require in connection with the
realisation and distribution of the property of the banking company.
69. Special provisions for punishing offences in relation to banking
companies being wound up. — (1) The High Court may, if it thinks fit, take cognizance of
and try in a summary way any offence punishable under this Ordinance or under
the Companies Act, 1913, alleged to have been committed by any person who has
taken part in the promotion or formation of the banking company which is being
wound up or by any director, manager or officer thereof.
(2) When trying any such offence as
aforesaid, the High Court may also try any other offence not referred to in
sub-section (1) which is an offence with which the accused may, under the Code
of Criminal Procedure, 1898, be charged at the same trial.
(3) In any case tried summarily under
sub-section (1), the High Court—
(a) need not summon any witness, if
it is satisfied that the evidence of such witness will not be material;
(b) shall not be bound to adjourn a
trial for any purpose unless such adjournment is, in the opinion of the High
Court, necessary in the interests of justice;
(c) shall, before passing any
sentence, record judgement embodying the substance of the evidence and also the
particulars specified in section 263 of the Code of Criminal Procedure, 1898,
so far as that section may be applicable; and nothing contained in sub-section
(2) of section 262 of the Code of Criminal Procedure, 1898, shall apply to any
such trial.
(4) All offences in relation to
winding up alleged to have been committed by any person specified in
sub-section (1) which are punishable under this Ordinance or under the
Companies Act, 1913, and which are not tried in a summary way under subsection
(1) shall, notwithstanding anything to the contrary contained in that Act or
the Code of Criminal Procedure, 1898, or in any other law for the time being in
force, be taken cognizance of and tried by a Judge of the High Court other
than the Judge for the time being dealing with the proceeding for the winding
up of the banking company.
(5) Notwithstanding anything to the
contrary contained in the Code of Criminal Procedure, 1898, the High Court may
take cognizance of any offence under this section without the accused being
committed to it for trial and all such trials shall be without the aid of a
jury.
70. Public examination of directors and auditors etc., in respect of a
banking company under scheme. — (1) Where an application for sanctioning a compromise or
arrangement in respect of a banking company is made under section 153 of the
Companies Act, 1913, or where such sanction has been given and the High Court
is of opinion, whether on a report of the State Bank or otherwise, that any
person who has taken part in the promotion or formation of that banking company
or has been a director or auditor thereof should be publicly examined, it may
direct such examination of such person and the provisions of section 66 shall,
as far as may be, apply to such banking company as they apply to a banking
company which is being wound up.
(2) Where a compromise or arrangement
is sanctioned of under section 153 of the Companies Act, 1913, in respect of
a banking company, the provisions of
section 235 of that Act and of section 67 shall, as far as may be, apply to
such banking company as they apply to a banking company which is being wound
up as if the order sanctioning the compromise or arrangement were an order for
the winding up of that banking company.
(3) Where a scheme of reconstruction
or amalgamation of a banking company has been sanctioned by the Central
Government under section 47 and the Central Government is of opinion that any
person who has taken part in the promotion or formation of that banking company
or has been a director or auditor thereof should be publicly examined, that
Government may apply to the High Court for the examination of such person and
if on such examination the High Court finds (whether a fraud has been committed
or not) that that person is not fit to be a director of a company or to act as
an auditor of a company or to be a partner of a firm acting as such auditors,
the Central Government shall make an order that that person shall not, without
the leave of the Central Government, be a director of, or in any way, whether
directly or indirectly, be concerned or take part in the management of any
company or, as the case may be, act as an auditor of, or be a partner of a firm
acting as auditors of, any company for such period not exceeding five years as
may be specified in the order.
(4) Where a scheme of reconstruction
or amalgamation of a banking company has been sanctioned by the Central Government
under section 47, the provisions of section 235 of the Companies Act, 1913,
and those of section 67 shall, as far as may be, apply to the banking company
as they apply to a banking company which is being wound up as if the order
sanctioning the scheme of reconstruction or amalgamation, as the case may be,
were an order for the winding-up of the banking company;
and any reference in the said section
235 to the application of the official liquidator shall be construed as a
reference to the application of the Central Government.
71. Special provisions for banking companies working under schemes of
arrangement at the commencement of the Ordinance. Where any compromise or arrangement
sanctioned in respect of a banking company under section 153 of the Companies
Act, 1913, is being worked at the commencement of this Ordinance, the High
Court may, if it so thinks fit, on the application of such banking company—
(a) excuse any delay in carrying out
any of the provisions of the compromise or arrangement; or
(b) allow the banking company to
settle the list of its debtors in accordance with the provisions of section 63
and in such a case, the provisions of the said section shall, as far as may be,
apply to the banking company as they apply to a banking company which is being
wound up as if the order sanctioning the compromise r arrangement were an order
for the winding up of the banking company.
72. Appeals. — (1)
An appeal shall lie from any order or decision of the High Court in a civil
proceeding under this Ordinance when the amount or value of the subject-matter
of the claim exceeds five thousand rupees.
(2) The High Court may by rules
provide for an appeal against any order made under section 69 and the
conditions subject to which any such appeal would lie.
(3) Subject to the provisions of
sub-section (1) and subsection (2) and notwithstanding anything contained in
any other law for the time being in force, every order or decision of the High
Court shall be final and binding for all purposes as between the banking
company on the one hand, and all persons who are parties thereto and all
persons claiming through or under them or any of them, on the other hand.
73. Special period of limitation. — (1) Notwithstanding anything to the contrary contained
in the Limitation Act, 1908, or in any other law for the time being in force,
in computing the period of limitation prescribed for a suit or application by
a banking company which is being wound up, the period commencing from the date
of the presentation of the petition for the winding up of the banking company
shall be excluded.
(2) Notwithstanding anything to the
contrary contained in the Limitation Act, 1908, or section 235 of the Companies
Act, 1913, or in any other law for the time being in force, there shall be no
period of limitation for the recovery of arrears of calls from any director of
a banking company which is being wound up or for the enforcement by the banking
company against any of its directors of any claim based on a contract, express
or implied; and in respect of all other
claims by the banking company against its directors, the period of limitation
shall be twelve years from the date of the accrual of such claims or five years
from the date of the first appointment of the liquidator, whichever is longer.
(3) The provisions of this section,
in so far as they relate to banking companies being wound up, shall also apply
to a banking company in respect of which a petition for the winding up has been
presented before the commencement of this Ordinance.
74. State Bank to tender advice in winding up proceedings. Where in any proceeding for the winding up of a banking
company in which any person other than the State Bank has been appointed as the
official liquidator and the High Court has directed the official liquidator to
obtain the advice of the State Bank on any matter (which it is hereby empowered
to do),
It shall be lawful for the State Bank
to examine the record of any such proceeding and tender such advice on the
matter as it may think fit.
75. Power to inspect. — (1) The State Bank shall, on being directed so to do by the
Central Government or by the High Court, cause an inspection to be made by one
or more of its officers of a banking company which is being wound up and its
books and accounts.
(2) On such inspection, the State
Bank shall submit its report to the Central Government and the High Court.
(3) If the Central Government, on
consideration of the report of the State Bank, is of opinion that there has
been a substantial irregularity in the winding up proceedings, it may bring
such irregularity to the notice of the High Court for such action as the High
Court may think fit.
(4) On receipt of the report of the
State Bank under subsection (2) or on any irregularity being brought to its
notice by the Central Government, under sub-section (3) the High Court may, if
it deems fit, after giving notice to and hearing the Central Government in
regard to the report, give such directions as it may consider necessary.
76. Power to call for returns and information. The State Bank may, at any time by notice in writing, require
the liquidator of a banking company to furnish it, within such time as may be
specified in the notice or such further time as the State Bank may allow, any
statement or information relating to or connected with the winding up of the
banking company;
and it shall be the duty of every
liquidator to comply with such requirements.
Explanation.—For the purposes of this
section and section 75, a banking company working under a compromise or arrangement
but prohibited from receiving fresh deposits, shall, as far as may be, be
deemed to be a banking company which is being wound up.
77. District Magistrate to assist official liquidator in taking charge of
property of banking company being wound up. — (1) For the purpose of enabling the official
liquidator or the special officer appointed under sub-section (4) of section 45
to take into his custody or under his control, all property, effects and
actionable claims to which a banking company, which has been ordered to be
wound up, is or appears to be entitled, the official liquidator or the special
officer as the case may be, may if he deems it necessary in the interest of
speedy liquidation, request in writing the District Magistrate, within whose
jurisdiction any property, books of account or other documents of such banking
company may be situated or be found, to take possession thereof, and the
District Magistrate shall, on such request being made to him, take possession
of such property, books of account or other documents and forward them to the
official liquidator or the special officer.
(2) For the purpose of securing
compliance with the provisions of sub-section (1), the District Magistrate may
take or cause to be taken such steps and use or cause to be used such force as
may, in his opinion, be necessary.
78. Enforcement of orders and decisions of high court. — (1) All orders made in any civil
proceeding by a High Court may be enforced in the same manner in which decrees
of such court made in any suit pending therein may be enforced.
(2) Notwithstanding anything to the
contrary contained in the Code of Civil Procedure, 1908, a liquidator may apply
for the execution of a decree by a court, other than the one which made it, on
production of a certificate granted under sub-section (6) of section 63 and on
his certifying in writing the amount remaining due or relief remaining
unenforced under the decree.
(3) Without prejudice to the
provisions of sub-section (1) or sub-section (2), any amount found due to the
banking company by an order or decision of the High Court may, with the leave
of the High Court, be recovered in the same manner as an arrear of land
revenue.
79. Power of high court to make rules.
The High
Court may make rules consistent with this Ordinance and the rules made under
section 92 prescribing :
(a) the manner in which inquiries and
proceedings under Part III or Part IV may be held ;
(b) the offences which may be tried
summarily ;
(c) the authority to which, and the
conditions subject to which, appeals may be preferred and the manner in which
such appeals may be filed and heard ; and
(d) any other matter for which
provision has to be made for enabling the High Court to effectively exercise
its functions under this Ordinance.
80. References to directors, etc., shall be construed as including
references to past directors, etc. For the removal of doubts it is
hereby declared that any reference in this Part to a director, manager,
liquidator, officer or auditor of a banking company shall be construed as
including a reference to any past or present director, manager, liquidator,
officer or auditor of the banking company.
81. Part II not to apply to banking companies being wound up. Nothing contained in Part II shall apply to a banking company
which is being wound up.
82. Validation of certain proceedings.
Notwithstanding
anything contained in section 61 or any other provision of this Part, no
proceeding held, judgement delivered or decree or order made before the
commencement of this Ordinance, by any Court other than the High Court in respect
of any matter over which the High Court has jurisdiction under this Ordinance
shall be invalid or be deemed ever to have been invalid merely by reason of the
fact that such proceeding, judgement, decree or order was held, delivered or
made by a court other than the High Court.
PART V
MISCELLANEOUS
83. Penalties. — (1) Whoever in any return, balance-sheet or document or in any
information required or furnished under or for the purposes of any provision of
this Ordineanor willfully makes a statement which is false in any material
partitauce, knowing it to be false, or willfully omits to make a material
stiral, ment, shall be punishable with imprisonment for a term may extend to
three years and shall also be liable to fine.
(2) If advances are made by a banking
company in contravention of the provisions of sub-sections (1) and (2) of
section 24, every director or other officer of the banking company who is
knowingly a party to the contravention shall be punishable with imprisonment
which may extend to three years and with fine not exceeding twenty thousand
rupees.
(3) If any person fails to produce
any book, account or other document or to furnish any statement or information
which under sub-section (4) of section 40 it is his duty to produce or furnish,
or to answer any question relating to the business of a banking company which
he is asked by an officer making an inspection under that section, he shall be
punishable with a fine which may extend to two thousand rupees in respect of
each offence, and if he persists in such refusal, to a further fine which may
extend to one hundred rupees for every day during which the offence continues.
(4) If any deposits are received by a
banking company in contravention of an order under clause (a) of sub-section
(6) of section 40, every director or other officer of the banking company
unless he proves that the contravention took place without his knowledge or
that he exercised all due diligence to prevent it, shall be deemed to be guilty
of such contravention and shall be punishable with a fine which may extend to
twice the amount of the deposits so received.
(5) If any other provision of this Ordinance
is contravened, or if any default is made in complying with any requirement of
this Ordinance or of any order, rule or direction made or condition imposed
thereunder ; every director, liquidator and other officer of the company and
any other person who is knowingly a party to the contravention or default shall
be punishable with - fine which may extend to two thousand rupees, and where a
contravention or default is a continuing one, with a further fine which may
extend to one hundred rupees for every day during which such contravention or
default continues.
84. Cognizance of offences. No court shall take cognizance of any
offence punishable under section 83 except upon complaint in writing made by
an officer of the State Bank generally or specially authorized in writing in
this behalf by the State Bank, and no court inferior to that of a Magistrate of
the First Class shall try any such offence.
85. Application of fines. A court imposing any fine under this Ordinance
may direct that the whole or any part thereof shall be applied in or towards
payment of the costs of the proceedings, or in or towards the rewarding of the
person on whose information the fine is recovered.
86. Special provision for private banking companies. The exemptions, whether express or implied, in favour of a
private company in sections 17,77, 83B, 86H, 91B and 9 ID, of and sub-section
(5) of section 144 of the Companies Act, 1913,
shall not operate in favour of a private company which is a banking
company.
87. Restriction on acceptance of deposits withdrawable by Cheques. No person other than a banking company, the State Bank, the
National Bank of Pakistan
Provided that nothing contained in
this section shall apply to any savings bank scheme run by the Government.
88. Change of name by a banking company.
Notwithstanding
anything contained in section 11 of the Companies Act, 1913, the Central
Government shall not signify its approval to the change of name of any banking
company unless the State Bank certifies in writing that it has no objection
to such change.
89. Alteration of memorandum of a banking company. Notwithstanding anything contained in
the Companies Act, 1913, no application for the-confirmation of the alteration
of the memorandum of a banking company shall be maintainable unless the State
Bank certifies that there is no objection to such alteration.
90. Certain claims for compensation barred. No person shall have any right, whether in contract or
otherwise, to any compensation for any loss incurred by reason of the operation
of any of the provisions contained in sections 11, 15, 20, 41, 42, 47 and 58 or
by reason of the compliance by a banking company with any order or direction
given to it under this Ordinance.
91. Application of certain provisions to banking company incorporated by
special enactments of the central legislature.
In the case
of a banking company incorporated by a Central Act and not liable to be wound
up under the Companies Act, 1913, the provisions of sections 11, 16 to 19, 21,
23 to 25, 28 to 33, 34 excluding sub-section (3), 36, 39, 40, 42, 45, 46, 83,
84, 85, 90, 92 and 93 shall, without prejudice t» the provisions of such
Central Act, apply so far as may be, to and in relation to such banking
company.
92. Power of central Government ot make rules. — (1) The Central Government may, after
consultation with the State Bank, make rules to provide for all matters for
which provision is necessary or expedient for the purpose of giving effect to
the provisions of this Ordinance and all such rules shall be published in the
official Gazette.
(2) In particular, and without
prejudice to the generality of the foregoing power, such rules may provide for
the details to be included in the returns required by this Ordinance and the
manner in which such returns shall be submitted and the form in which the
official liquidator may file lists of debtors to the Court having jurisdiction
under Part III or Part IV and the particulars which such lists may contain and
any other matter which has to be, or may be prescribed.
(3) All rules made under this section
shall be subject to the condition of previous publication, and the date to be
specified under clause (3) of section 23 of the General Clauses Act, 1897,
shall not be less than six months from the date on which the draft of the
proposed rules was published :
Provided that in respect of the first
occasion on which rules are made under this section, the provisions of this
sub-section shall not apply.
(4) The Central Government may, by
rules made under this section, annul, alter or add to, all or any of the
provisions of the Third Schedule.
93. Power to exempt in certain cases.
The Central
Government may, on the recommendation of the State Bank, declare, by
notification in the official Gazette, that any or all of the provisions of this
Ordinance shall not apply to any banking company or to any class of banking
companies either generally or for such period as may be specified.
94. Protection of action taken in good faith. No suit or other legal proceeding shall lie against the
Central Government, the Provincial Government, the State Bank or any officer of
such Government or Bank for anything which is in good faith done or intended to
be done in pursuance of this Ordinance or of any rules or orders made
thereunder, or for any damage caused or likely to be caused by any thing done
or intended to be done as aforesaid!.
95. Repeals. — (1)
The enactments mentioned in the third column of the First Schedule shall be
repealed to the extent specified in the fourth column thereof.
(2) Notwithstanding the repeal under
sub-section (1) anything done or any action taken, in the exercise of any power
conferred by any enactment or any provision thereof so repealed, shall for all
purposes be deemed to have been done or taken in the exercise of powers
conferred by this Ordinance as if this Ordinance had been in force on the day
such thing was done or such action was taken.
THE
FIRST SCHEDULE
(See Section 95)
REPEAL
|
Year
|
No.
|
Short Title
|
Extent of repeal
|
|
1
|
2
|
3
|
4
|
|
1913
|
VII
|
The companies act, 1913 ..... .... ..... .....
|
The whole of Part XA.
|
|
1946
|
IV
|
The Banking Companies (Inspection ) Ordinance, 1946
|
The whole.
|
|
1946
|
XXVII
|
The Banking Companies (Restriction
of Branches) Act., 1946.
|
The Whole.
|
|
1948
|
XXII
|
The Banking Companies (Control Act,
1948.
|
The Whole.
|
THE
SECOND SCHEDULE
(See Section 34)
Form A
Form of Balance Sheet.
|
Sr. No.
|
Capital and Liabilities.
|
Rs. Ps.
|
Rs. Ps.
|
Sr. No.
|
Property and Assets.
|
Rs. Ps.
|
Rs. Ps.
|
|
1.
|
Capital : (a)
Authorised Capital ....... Shares
of Rs. ................ each .......................
|
|
|
1
|
CASH.
In land and with state Bank and
National Bank of
|
|
|
|
Issued Capital ...............
shares of Rs. ............... each ........................
|
|
|
2
|
BALANCES WITH OTHER BANKS.
(showing whether on deposit or
current account):
(i)
In
(ii)
Outside
|
|
|
|
|
Subscribed Capital ....... Shares
of Rs.................. each ..............................
|
|
|
3
|
MONEY AT CALL & SHORT NOTICE
|
|
|
|
|
Amount called up at Rs............
per share.......
|
|
|
4
|
INVESTMENTS
(stating mode of valuation, e.g.,
cost or market value):d
(i)
Securities of the central and Provincial Governments and other trustee
securities, including Treasury Bills of the central and Provincial
Governments.
(ii) Shares
(classifying into preference, ordinary, deferred and other classes of shares
and showing separately shares fully paid up and partly paid up.
(iii) Debentures or Bonds
(iv) other investments (to be classified under
proper heads).
(v)
Gold. .. .. ..
|
|
|
|
|
Less Calls unpaid .. .. ..
|
|
|
|
|
|||
|
Add forfeited shares.
|
|
|
|
|
|||
|
2.
|
RESERVE FUND AND OTHER RESERVES.
|
|
|
|
|
||
|
3.
|
DEPOSITS & OTHER ACCOUNTS: .. ..
|
|
|
|
|
||
|
Fixed Deposits.
|
|
|
|
|
|||
|
Savings Bank Deposits.
|
|
|
|
|
|||
|
Current accounts, contingency
Accounts etc.
|
|
|
|
|
|||
|
4.
|
Borrowings from other banking
companies, agents etc.
(i)
In
(ii) Outside
Particulars.
(i)
Secured (stating the nature of securities)
(ii) Unsecured. .. .. ..
|
|
|
5
|
ADVANCES.
(other than bad and doubtful debts
for which provision has been made to the satisfaction of the auditors.)
(I) Loans, Cash Credits, overdrafts, etc.;
(i)
In
(ii) outside
(iii) Bills Discounted and purchased: (excluding
treasury Bills of the central and provincial Governments.):
(i)
Payable in
(ii) Payable outside
Particulars of ADVANCES:
(i) Debts considered good in
respect of which the banking company is fully secured. .. ..
(ii). Debts considered good for which the
banking company holds no other security than the debtors personal security.
.. ..
(iii) Debts considered good secured by the
personal liabilities of one or more parties in addition to the personal
security of to debtors.
(iv) Debts considered doubtful or
bad, no provided for.
(v) Debts due by directors or officers of
the banking company or any of them either severally or jointly with any other
persons.
(vi) Debts due by companies or firms in which
the directors of the banking company are interested as directors, partners or
managing agents or in the cases or private companies, as members.
(vii) Maximum total amount of advances,
including temporary advances made at any time during the year to directors or
managers or officers of the banking company or any of them either severally
or jointly with any other persons : (e)
(viii) Maximum total amount of advances, including
temporary advances granted during the year to the companies or firms in which
the directors of the banking company are interested as directors, partners or
managing agents or, in the case of private companies, as members: (e)
(ix) Due from banking companies.
|
|
|
|
5
|
BILLS PAYABLE
|
|
|
|
|
|
|
|
6
|
BILLS FOR COLLECTION
BILLS RECEIVABLE AS PER CONTRA:
i.
Payable in
ii. Payable outside
|
|
|
|
|
|
|
|
7
|
OTHER LIABILITIES: (b)
|
|
|
|
|
|
|
|
8
|
ACCEPTANCES, ENDORSEMENTS AND OTHER
OBLIGATIONS PER CONTRA.
|
|
|
|
|
|
|
|
9
|
PROFIT AND LOSS:
Profit as per last balance sheet.
Less appropriations .. ..
Add profit for the year brought
from the profit and loss account.
|
|
|
|
|
|
|
10
|
CONTINGENT LIABILITIES: (C)
|
|
|
|
|
|
|
|
|
|
|
|
6
|
BILLS RECEIVABLE BEING BILLS FOR
COLLECTION AS PER CONTRA :
(i) Payable in
(ii) Payable outside
CONSTITUENTS LIABILITIES FOR
ACCEPTANCES, ENDORSEMENTS AND OTHER OBLIGATIONS PER CONTRA.
|
|
|
|
|
|
|
|
8
|
PREMISES LESS DEPRECIATION: (f)
|
|
|
|
|
|
|
|
9
|
FURNITURE AND FIXTURES LESS
DEPRECIATION: (f)
|
|
|
|
|
|
|
|
10
|
OTHER ASSETS, INCLUDING SILVER (to
be specified ) : (g)
|
|
|
|
|
|
|
|
11
|
NON-BANKING ASSETS ACQUIRED IN
SATISFACTION OF CLAIMS (stating mode of valuation): h
|
|
|
|
|
|
|
|
12
|
Profit and loss .. ..
|
|
|
|
|
Total :
|
|
|
|
Total :
|
|
|
(Second Schedule)
NOTES
(a) Capital.—
(i) The various classes of capital,
if any, should be distinguished,
(ii) Shares issued as fully paid-up
pursuant to any contract without payments being received in cash should be
stated separately.
(iii) Where circumstances permit,
issued and subscribed capital and amount called up may be shown as one item,
e.g.. Issued and Subscribed Capital......................Shares of
Rs...................paid-up.
(iv) In the case of banking companies
incorporated outside Pakistan
the amount of deposit kept with the State Bank of Pakistan
(b) Under this heading may be
included such items as the following;
pension or insurance funds, unclaimed
dividends, advance payments and unexpired discounts, liabilities to subsidiary
companies and any other liabilities.
(c) These should be classified under
the following categories:—
(i) Claims against the banking
company not acknowledged as debts.
(ii) Money for which the banking
company is continently liable showing separately the amount of any guarantee given
by the banking company on behalf of directors or officers.
(iii) Arrears of cumulative
preference dividends.
(iv) Liability on Bills of Exchange
re-discounted.
(v) Liability on account of
outstanding Forward Exchange Contracts.
(d) Where the value of the
investments shown in the outer column of the balance sheet is higher than the
market value, the market value shall be shown separately in brackets.
(e) Maximum total outstanding balance
in all such accounts as a unit on any day during the year should be given under
this heading.
(f) Premises wholly or partially
occupied by the banking company for the purposes of business should be shown
against “Premises less depreciation”. In the case of fixed capital expenditure,
the original cost, and additions thereto and deductions therefrom during the
year should be stated, as also the total depreciation written off. Where sums
have been written off on a reduction of capital or revaluation of assets, every
balance sheet after the first balance sheet subsequent to the reduction or
revaluation should show the reduced figures with the date and amount of the
reduction made. Furniture, fixtures and other assets which have been completely
written off need not be shown la the balance sheet.
(g) Under this heading may be included
such items as the following, which must be shown under headings suitably
described; preliminary, formation and organisation expenses, development
expenditure, commission and brokerage on shares, interest accrued on
investments but not collected, investments in shares of subsidiary companies
and any other assets.
(h) Value shown shall not exceed the
market value and in cases where the market value is not ascertainable, the
estimated realisable value.
General Instructions.—The
corresponding figures (to the nearest rupee, if so desired) for the year,
immediately preceding the year to which the profit and loss account relates
should be shown in separate columns.
Form
B
FORM OF PROFIT AND LOSS ACCOUNT
Profit and Loss Account for the year ended..................................................
December.
|
Sr. No.
|
Expenditure
|
Rs. Ps.
|
Sr. No.
|
Income.
(Less provisions made during the
year for bad and doubtful debts and other usual or necessary provisions)
|
Rs. Ps.
|
|
1
|
Interest paid on deposits,
borrowings etc.
|
|
1
|
Interest and discount.
|
|
|
2
|
Salaries and allowances and
provident fund (showing separately salaries and allowances to managing
director, manager or chief executive officer)
|
|
2
|
Commission, exchange and Brokerage.
. .. .....
|
|
|
3
|
Directors and local committee
members fees and allowances .. ..
|
|
3
|
Rents ... ... ...
|
|
|
4
|
Rent, Taxes, insurance, lighting,
etc.
|
|
4
|
Net profit on sale of investments,
gold and silver, land, premises and other assets (not credited to reserves or
any particular fund or account) .. .. . ..
|
|
|
5
|
Law Charges .. ..
|
|
5
|
Net profit on revaluation of
investments, gold and silver, land, premises and other assets (not credited
to reserves or any particular fund or account)
|
|
|
6
|
Postage, Telegrams and stamps ...
..
|
|
6
|
Income from non-banking assets, and
profit from sale of or dealing with such assets .. ..
|
|
|
7
|
Auditors fees .. .. ... .. ..
|
|
7
|
Other receipts. .. .. ..
|
|
|
8
|
Depreciation on and repairs to the
banking companys property ... .... ..
|
|
8
|
Loss (if any)
|
|
|
9
|
Stationery, printing, advertisement,
etc. .. ..
|
|
|
|
|
|
10
|
Loss from sale of or dealing with
non banking assets
|
|
|
|
|
|
11
|
Other expenditure .. .. .. ..
|
|
|
|
|
|
12
|
Balance of profit .. .. .. .. ..
|
|
|
|
|
|
|
Total
Rs.
|
|
|
Total
Rs.
|
|
THE
THIRD SCHEDULE
See section 63 (2)
List of Debtors
1. The official liquidator shall,
from time to time, submit lists of debtors to the High Court, each list being
verified by an affidavit.
2. Every such list shall contain the
following particulars :—
(a) names and addresses of the
debtors ;
(b) amount of debt due to the banking
company by each debtors;
(c) rate of interest, if any, and the
date up to which such interest has been calculated in the case of each debtor;
-
(d) description of papers, writings
and documents, if any, relating to each debt;
(e) relief or reliefs claimed against
each debtor.
3. (a) In every such list, the
official liquidator shall distinguish between the debts for which the banking
company holds any security other than a personal security and the debts for
which no security or only a personal security is given ;
(b) In the case of secured debts,
particulars of the securities claimed by the banking company, and whenever
possible their estimated value, and the names and addresses of person or
persons, if any, having an interest in the securities or the right of
redemption therein ;
(c) In case the debt is guaranteed by
any person or persons, the name and address of the guarantor or guarantors with
particulars as to the extent to which the debt is guaranteed and description
of documents, papers or writings in support of such guarantee.
4. If the debtor is adjudged
insolvent either before or after he has been included in any such list, but
before such list is settled, the name and address of the assignee or the
receiver of his estate, as the case may be, should be stated in, or added to,
the list.
5. If the original debtor dies either
before or after he has been included in any such list, but before such list is
settled, there shall be substituted in his place the names and addresses of his
legal representatives as far as the official liquidator is able to ascertain-
No comments:
Post a Comment