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REC]STERED NO. trl. !i|:

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'@ht Wai$tt
@
EXTRAORDINARY
ofl Dahio{*:,
PUBLISHED BY AUTHORITY

ABAIT. WEDNESDAY, S[P]'E]iBER 13. t989

PART I
Acls. Ordlnmccg Presidenfs Or.hrs
' rd Reguletiols imhdiq Mrlrii jl Lan
Ordcrs md Regd.tom
GOVBRNMEIIT OF PAXII}rAN

MINISTRY,OF LATY, JUSTICE AND PARLIAMENTARY AFFAIRS

(L,r.w and Justice Division)
.
lslomabad, the l3th September, 1989

. No. . F. 2 (2)].E9-Pub.-The following Ordinance nlade hy the President on

l3th S€ptember. 1989 is hereby published for general information:-

ORDTNAMB No. Xtl or l9E9

AN

ORDINANCE

further to omend the Banking Componies Ordinonce, l9A.

WHEREAS it is expcdient lirlther to amend the Banking Companies Ordinance.

1962 (l-Vll of 1962),for the purposes hercinafter appearing :

AND \\,HEIBAS the National Assembly is not in session and the Presidellt is
satisfledthat r:ircLrmslances erist which render it necessary to take immediate
acti,on; '!rl
( 189)

?rice : Ps. 60
[3952 Ex. Gaz.]
 e'>o

190 TIIE Cr\Zt l'TE OF PAKISIAN, EXTRA, sEP 13' 19t9 [l'^Rr I

Now, THEREFoRE, in of the powers conferred by clause (l) of

exercise
,\Lticte 89 of the Constitution of the Islamic Republic of Pakistan ' the
President

is p)eascd to make and promulgate the following ordinance :-

Short title and commencement.--(1) This Ordinance may be callcd

thc
l.
Banking Companies (Second Amendment) Ordinance' 1989'
5 and 13' shall
{2) It shall come into force at once and, except for sections
be deemed to ha\e taken efiect on the Zth day of May' 1989'

2. Amendment ot section 3A. Ordinance LYII of 1962'-In the Banking

Ct,mpanies Ordinance' 1962 (LVII of 1962), hereinaftcr referred to
as the said
25 "' the commas'
Ordinance, in section 3A, aftcr the word and flgure " srction --
"
figures anrl letters ",25A, 25AA, shall be inserted'

3. Amenilmcnt of sectiont, Ordinence LYII of 1952'-In the said Ordinance'

insectiolr8.inthesecondproviso,ihewords..whollyorpartlyownedor
controlled by it or by the State Bank " shatl be omitted'

4. Insertion of seclion 25AA' Orrtinance LVII of 1951-In the said Ort

nance, after section 25A, the following new section shalt be inserted' namley:

"25AA,.PreParation of speciol reports State Ban( shdl prepare' and

-The rePort every year on cases
submit to the Federal GoYernment, a special
of *rite off of loans, mark-up and other dues, or flnanc'ial relief
rhrough rescheduling and restructuring of loans and subsidised loans
provided bl the banking companies, in which established banking
pra.tices or authorised procedures have been departed frorn rvith a
view to causing wrongful loss to the bank on conferring wrongful
gain on an1' constituent or such departure has caused w'rongful loss
to the bank or conferred wrongful gain on any constituent lf the -
n]iltters raised in the report relatc to public intc?cst, thc Fedcral
Golernment may submit the report, or such part of lt as relates to
publi(' irterest, to Parliament or to the Standing Committec of a House
(;f Pirlianrent dealing rvith Finance. ".

5. Substitulion of seclion 27A. Ordinance LVII ot 1952'-In the said Ordi-

nance. for section 27A the following shall be substituted, namely:--

"27.^. itohibition ot adt'crtising for deposits and collection'-Notrvithstand-

ing anl'thing corltained in an\- other law for t}te time being in force'
llo compan\', 6tn or person, not being a banking compan)' or a cor-
poration or authority established by the Federal Goveruntent or a
company duly authorised in this behalf by the C-ootrollcr of Capital
P^ff ll
6>\
IHE CA2E'mE OF PAKISTAN, EXTRA., sEp. 13, l9E9 t9t
Issues or the Corporate Law Authoriry or the Regsuar Cooperative
soc leties, shall solicit or invire deposirs of money from the publit
ihlough adverdsemenb in the public media or by posEl ctcular.s,
rr.rrrdbills, displays in public places or by any orher rneans,
or collc( r
{)r receive a.ll) dep.rsiLs of monc1. in pursuance thereof.

L.tplunution ..deposits
-For rhe purposes of this section, of mr.ney ,. sirall
l-l: deemed to include motrey called, i[vited or collected for rhe
purpose, or declared object, of inyestment or borrowing in
an1
busi:ress carried ou, or proposed to be carded on, by the company,
irlm or person by whom, or on whosc b€halI, such money is rallcd,
i,,rited, collecred or received irrespectiye of rhe natue of the relation_
ship, arrangement or tcrms ollered or provided by such compaly, tirnr
(,r person to the person making the ilvestment,
deposits of Boney or
p,]yment or of the basis or understanding on which the money is so
r,rlled, ilvited, collected or received..,.

6, furendlcra ot scction 40 Or.tinloce LVII ot I952._In rhe said Ordi.

[auce, in section 40, in sub-section (4), alter the word ,. banking compatry,,,
wher*cr occurring, thc words, figure antl letter ', or any company or
fum or
t)ctso[ retened to in secrion 27A., shall be inserted.
I
,. 7. Am€ndic of s€ctior 43A, Ordin,rnqc LVII of 1952.-In the said Ordi.
nancc, iI scction 43A,-
(a) ifter the u/ord ,.c)mpan).", wherel,er occurring, the comma aird
word ",firm,, shall be insened; and
{b) after the figure and comma ',27,,, the words, figure, Ietter
and comma
'' or is receiving or has receivcd deposits
of money in contravenrion of
section 27A,', shall be inserted.

8. Iru€rtioE of new section 43AA, Ordioance LyII of 1962._tn

rhe said
Ordir.,rnce. afrer section 43A, the following new section
shall be inserred,
nanrell,:-
'' 43AA. Special provisions.-( 1) Where the State Bank has called
for intor-
nlation under section 43A from a company, firm or person and ir
appears to the State Bank that, in the interest of the persons
frr,m
whom the deposits of moneys were received, it is necessary that
tlx,
moneys received and other asscts of the company, firm
or pcrson.
whether held in the name of that company, firm or person or of
arr_r.
other person, are protectd and preserved. rhe State Bank
ma1.. lvirh-
out prejudice to any other action or proceedings which may be rakcn
 e)r'
lo) TTIE GAZETTE OF PAKISTAN, DfiRA', SEP. t3, 1989 [i:^Rt I

against such company, firm or person under aly ottrer provinons of

this Ordinance or any other law for the dme belng in force, makc
an order in wdtinS-
(a) appointing one or more persons as illteriilr receiver or receivers
auihorising him or, as the case may bc. each onc of them to-
(i) entsr aod search any premises and seize boots of ac@unts or
other docunents or records of such deposits oJ money; and
(ii) take in his custody, on behall o[ thc State Bank' all moneys'
cash securities, title deeds, prop tics, wh€ther movable' or
immovable, belonging to such conrpalil' [irm or Frson, includiug
thosc being hcld on behalf, or in tlic name' o[ any director,
mattager, oflicer, partncr' cnlplolJ,r. Jge,rt' bencltciary or uans'
feree of such compury' iirm or person ol thcir dependants;
(b) directing any bank, tltratrcial institution or pcrson to lrcczc all mo[eys
deposited with it or him on behalt oi lhe cotttpanl' fifnr or person
or of any director, manager, omcer, Partner or enrployee, agent'
beueficiarl or transferee of such conpanl', hrrl or Person and deliver
such moneys to the Person aPPointed bl it under clause (a) ;

(() .luthorising a person apPoi[ted under <lattse (a) to take all necessary
sieps and measures for identitying lhc assets alld properties oi the
company, firm or pcrson and for realisatirrtt, prrt(ection and preservation
thcreof :

(d) restraining any comPany, lilm or person or any directr.rr. manager,

olficer. partner ol employee or agent' beDelici;lrl or transleree oI such
company, firm or person or their (lependants or any other pt rron
tlcriring or claiming title rhrough any oi thcm from alicnating, trans-
I'cr!ing. sclling, assigfling. disposing ol or pnr'ling rvith possession of
an) prop.:rty, morable or immovable. ol dcriving any bcnefit' reot
or ineotttc therelrom : and

tc) maki[g such c,rders for realisation, protccli(x] and prescrvatiou of

deposits of monc) and otll,:i assets antl plopcrties oI thc conrpany'
lirm or person as i1 maY deem fit.
t2) An order made under sub-section (1) shall. unlcss it is earlier withdrawn
ii pLrl-suar:cc of thc proriso to sutrsc( tion (l) of sectiort 438, remain in forcc
untiI possession of the motrcls. cash securitit]s. tiilc dceds' propertics' books of
;lc(ount. documents oI records to lvhich the ordcl relates is taken over b1- tht'
o0icial Iiquidator ol. as thc case may be. the lligil (i'irti. itt pttt'suance of an
errcler ot lhe High Court under saction 43F:
 6'5-'
PAnr Il THE GA /i:'II'E OF PAKISTAN, EXTRA., sEP 13, lg8e idt
Providrd {hal dly orllcr nrade under sub-section (l) shall uot prevent the
High Ctrrrr. f!.xn d.rteroriniq: th: right .f a persorr claiming to have acquired
the
plqrc'1\ or .tssel f!-om rhc conpan),. firnt or. person, bona fide and for valuable
:rltl rdc<1u.ric .onsiderati(nr rvhi<:h srrch person shall be rtquired to prove paid
as
ir LrI his rlwn rl,s{}urtes.

q3r ,\rr order ,nade under subscction (l)

may be served on the &egisrrar
rri Joint SLoek Ccnrpunics oi. such orll.r. ollicer or authority or person as (he
Sate Beot may deea proper.

(4) Il any person authorised under sub_sec,.ion (l) requLes

assistance of the
police or iln) other ci'il authoriD. in the exercisc of
his powers or distharge
,..ri his funr-tions rhereunder. hc nray.
scnd a requisition to the oftcer in.harje
a pohce sration or te such authority who sha.ll on such requisition render if
rhe
assistarce rdqrired, ".

9 -af sedion 438, Ordinance LvtI of [ry,_h the said Ordi.

nalcc ^!t|tf,fir€
in scction 43B.*
(a) in suUsection ( l),-
ti) altcr. rhc \,,ord ..company,., wherever occurring, the comrDa
ad
tord ",lirm shall be insened;
(ii) rfr.r rhc ligurc and collrma * 27,-' the wurds,,figure, letter atrd
comma " or is receiving .or has received depgsits of motrey
in
corurarcntion of section 27A,.. shall be insrted I and
(iii) for .he full 6top ar the end a colon shall be subsrituted and
th(rcrfrer the Iollowing proviso shall be added, namely :_
,,pr,rvided
thar. in a case in which the State Bank has made
at order un(ler suhscciion tl) oi se(.tion 43AA in respect
of a
( oDrpany, 6rm or peron,
the State Ban_k shall make a declaration
under this sub-section in reJpect of such company, flrm or person
within three months of rhe rnaking of such, order or within such
lurther time, not exceeding three months in tie aggregate, as the
High Court may allow, or rviti&aw such order.li; and
.fot, sEb-section (2) the following
1b) shall be substituted, namcly :_
" t2) the State U.urk shall publish, or cause to be published, a declata_
tion rna(le r.uider sub.section (l) in two newspapers having wide
.irc,rlation in the area in rvhich the registered offce of tie com_
p.rn.v or firm. or thc principal offcc of the person,
to which or
ro u h nr rhe declaradon relates is situated; and, upon such
 r 4^L,l
b./
194 THE GAZETIE OF PAKISTAN, EXrRA., sEP. 13, 1989 [i'^Rr I
#
publication, thc company, Iirm or such person or the chief execu-
tive, b) whatever name called, or directors, rnanagers, t-rlticeis.
corployecs or a8ents of the company or Partners, manaSers
offlcers, cmployees or agents of thc litm, or such person, or anl
otircl pcr'sorl rclerred to in suFscclions (l), (3) or (4) of section 43D
or section 43E, shall not be heard to plead ignorauce of the
. making of the declaration. .

Amcdm€nt of seclion 43C' Ordinalce

10. LYll oI 1962.-tn the said Ordi
nance, in section 43C,-

(a) in subsection (l), after the word " compan)'' , wherever occurring.
the comma and word ",firm " shall be inserted; and
(a) in subsection (2), after the word coropan)''', mcurring for the
second time, the comma and word ", firm " shall be inserted.

I l. Am€nfu€trt o[ section rl"1D, Ordinance LYII ot 1952.-In the said Ordi-

nance, in s€ctiotr 43D,-
(a) in sub-section (L), aiter thc word " company ", wltcrever occurriog,
the comma and word ", firm " shall be inscrted;
(b) for sub-scction (3) the following shall be substituted, namely:-
" (3) Until such time as an official liquidator, official assignee, inte;im
rcceiver, receiver or official receiver, as the case may be appointed
by the Court on an application madt under section 43F take:
over tle pc;session, < ustody or conkol of any books, documents,
r ecords and asse* of a compan), firnr or person in respcct of

which or whom a declaration under sub-section (l) of section

438 has been made. including ;tny' at Lionablc claims to which
such company, firm or person is. or appears to be, entided, the
chief executive, by whatever name called, and a duector,
manager, officer, employee and agent of such company, ot a -
partner, marager, ofiicer, cmployee and agent of such frrm or -
person, and every other person who may have in or undcr his
, possession, custdy or control of such books, documents, records,
assets or claims, shall preserve, and aid in preserving, such books,
documents, records. assets and claims and shall, without pre-
judice to any other liability that he may incur, be iointly and
severalll' liable for an.v loss or damage. " ; and
(() in sub-section (4), after the rvord " compan1"', the comma and word
", firur " shall be inserted.
 br'
tl
12. Subetitution of sectior 43E. Otdimnce LVII oI 1962._In the
said Ordi-
rancc. for sc(tion 43ll thc followlng shall be substituted, namely :_

" 438. Slatement of assets and liabilities to be submitted to

Sute funL,_
Within three days of the publication of a declaration under sub_section
( I) of section 438 in respect of a company,
firm or other person, or
u.ithin such further rime as the State Bank may, by order in writing.
allow, the chief executive, by whatever name called, and every direc_
tor, malager, officer, and agent of the company, and every panner
of rhe firnr and the manager, ollicer and agent of the firm or such
pcrson. and evcr). other person having a claim or liability
agaiast or
rowards rhe compan)., firm or such person shall submir to
the State
Ilank a srarement showing the assets and liabilities of the company,
Iir.nr or such person so far as may be known to
him.,,.

13. Am€ndm€nt of section t3, Ordinance LVII of 1952.-In the said Ordi-
nancc, in section 83,-

(a) in sub-section (lQ,-

(i) for the word, figure and letter,,section 43A,,the words, figures
and letters " section 27A or secrion 43A', shall be substituted;
and

(ii) after the figure and letter ..43E", the commas, words, ffgure
and letters ", or obsEucts or hinders any penroD ln thc qercise
of his porrers or discharge of his functions undcr secdon 43AA, ,,
shall be inserted ; and

(b) for subsection (lD) thc following shall be substituted, namety :_

" (lD) If an1' companl', finn or person contraven€s the provisions of
section 27A, the chief executive of the company and its ditcctors.
evcrv pilrtner of thc firnt and such person shall be guilty of an
oLlerrrc punishablt' wirh ilnprisonment of either description for a
(!'rnt which nray L'xtcnd to lcn
).cars alrd with fine the amount of
rvhich shall not be less than twice the amount of deposits reccil,ecl
in contravenlion of the said section and forefeiture of whole or
part of thc property of such company, firm or person and the
chicf cxecutive of the company and its directors, every partner
of the flrm and person. ".
 bv6

196 r$E G_AZEffE OF P,\h'lsl .\N, ' [Xl R'\'. sl:l' 13' 1989 [PABT I

14. Amcdmelll Df sotliur &l O.{Iluee LVll oi 1952'-tn the said Ordi-
nance, in section 84, for subseclion (l) th( lbllowing shall
be substituted'
namcly :

:1'(l) t{o (ou}t shall tike cognizance of atrv ofttrxe punishable undet sul].
sc(tidns (l), {lA), (lB), (l(l) and (lD} of se(tion 83 except
on a com-
plaiht in writing rnatle b1' an ofliccr ol the State [3ank generalll' or'
spc<iall;- auth,,rised in writing iri this behalf by the State. Banl"
and
'no aourt othei thah the High (lourt shall rrl any such offencc "'

15. A.renrblent of seclion 90, Ordinance LYtt of 1962'-In the said

Ordi'
nance, in section 90.-
{at after ihe figure. le$er and r:onrma "25A"" the figure' letitr and
rontnra " 27A. " shall be inserted; and
(b) after the ligure. letter and comma " 43A" the figure' letters arrd

lonrma '43AA. " shall be inserted.

16. Arnen.Inieot df seclion 91A, (Hinance LVII of 1952'-In the said Ordi-
nance. in section 9lA,-
- (a) afier the ligurt'. letter and comma " 26A, the figure 'letter and
comma " 27A. " "
shall be inserted; and
(ib) dfter the figre. letter and comma " 43A. "' the frgure' letters and
( o:1lma " 43,^\4, ' shall be in$lted.

GHULAI\4 ISHAQ KHAN,

?resident.

MR. ,JUSTICE NASIR ASLAM ZAHID,

Secrctory law and lustice T'rivisiotl

.--
CO RRIG E IiD -I
the 3rd September' 1989 con'
[to the.Gazctte of Pakistan' t989. Part-I. dated
taioing Ordinalcos No. X tnd XI ol 1989.1

'Page I &l: In line I 6. for "shall dcerned". /c(d "shall be deemed"'

Pagc l84 : In line T !'r'orn ihe bottonr. for"'clru'e (21" rcad"clau:-e (a)"'
Itage 188 : In.linc 13. foi "Atticlc 5.(r.7.8.9.10 lrrd ll"' rcrrl "Articles 5'
6. 7. 8. 9. l0and Il".

peirsleo nf HS XANAGBR. TSINTING CORPORATION OF PA&ISTAN INBIS, ISLAMAIAT.

?uu.rsHsD aY TI|E XANAOII O[ tullcA'lloaa IxxE