1. This is a petition under subsection (1) of section 83-B read with proviso of the Banking Companies Ordinance, 1962 as amended vide Ordinance XI of 1988 (hereinafter referred to as the Ordinance) moved by the State Bank of Pakistan in which the following prayer has been made:-- "To allow three months' time to the State Bank of Pakistan (Petitioner) commencing from 31-1-1989 to make necessary declaration against the aforesaid Company as envisaged in the proviso of Section 43-B(1) of the Banking Companies Ordinance, 1962 as enacted vide Ordinance No. XI of 1988 and re-enacted vide Ordinance No. III of 1989: I have heard Mr. Muhammad Shibli for the petitioner, State Bank of Pakistan.
2. The brief facts of the case are that M/s. Alliance Motors (Pvt) Limited is a private limited Company having its office at Alliance Motors Building, near Sabzi Mandi, University Road, Karachi. On attention being drawn through Press and otherwise that the aforesaid Company is transacting banking business illegally in contravention of Section 27(1) of the Ordinance and has been receiving deposits of money from the public, the petitioner took action under Section 43-A of the said Ordinance and called for information vide- its directives No. BID(Insp) 1877/406-A-88 19th July and No. BID (Insp) 1907/604-A-88 dated ?0th July, 1988. It is the further case of petitioner that as it appears to the petitioner Bank that in the interest of the persons from whom the deposits of money have been received, it is necessary that the moneys received and other assets of the aforesaid Company whether held in the name of the Company or of any other person, are protected and preserved, the petitioner Bank, in exercise of its powers under subsection (1) of Section 43-AA of the aforesaid Ordinance appointed Mr. Asad A.I Bilgrami, Advocate; 406, Press Centre, Karachi as the interim Receiver in respect of the said M/s University Road, Karachi, authorising him to act on behalf of the State Bank and to exercise all powers as envisaged in the said Section 43-AA vide its order dated 31-10-1988. A copy of the order dated 31-10-1988 appointing Interim Receiver is annexed to the Petition as Annexure `A'. It is the further case of the petitioner that since the objective for which the aforesaid order appointing Interim Receiver have not yet been fully achieved and the necessary declaration under Section 43-B(1) has not yet been made and is not expected to be made within three months from the appointment of the Receiver as required under proviso of Section 43-B(1) of the said Ordinance for the reasons that the directors/partners/officers of the said Company have gone into hiding and there does not appear any immediate prospect of their appearance and their co-operation with the Interim Receiver is not forthcoming and consequently the inquiry which is to be made under Section 13-A of the said Ordinance is not yet completed, it is necessary that this Court allows three months time commencing from 31-1-1989 for making a necessary declaration and thereby for continuance of the operation of the aforesaid order dated 31-10-1988 made by the petitioner in pursuance of section 43-AA of the said Ordinance appointing the Interim Receiver and the effectiveness of which would come to an end on 30th January, 1989 if extension of time is not allowed by his Court under the proviso of Section 43-B before that date.
3. It is necessary to state that the existing law in regard to unauthorisedly carrying on banking transaction in Pakistan, the Banking Companies Ordinance being Ordinance No. LVII of 1962 was amended by Companies (Second Amendment) Ordinance No. LVI of 1979. By the amending Ordinance, sub section (1) of section 27 of the original Ordinance was substituted. This Ordinance is further amended by Ordinance No. XI of 1988 and Ordinance No. III of 1989. After. Section 43-A, a new Section 43-AA was inserted by Section 8 o Ordinance No. XI of 1988. It is advantageous to reproduce Section 43-AA which reads as under:-- "43-AA. Special provisions.--(1) Where the State Bank has called for information under section 43-A from a Company, firm or person and it appears to the State Bank that, in the interest of the persons from whom the deposits of moneys were received, it is necessary that the moneys received and other assets of the Company, firm or person, whether held in the name of that company, firm or person or of any other person are protected and preserved, the State Bank may, without prejudice to any other action or proceedings which may be taken against such company, firm or person under any other provisions of this Ordinance or any other law for the time being in force, snake an order in writing:--
(a) appointing one or more persons as interim receiver or receivers authorising him or, as the case may be, each one of them to--
(i) enter and search any premises and seize books of accounts or other documents or records of such deposits of money; and
(ii) take in his custody, on behalf of the State Bank, all moneys, cash securities, title deeds, properties, whether movable or immovable, belonging to such company, firm or person, including those being held on behalf, or in the name, of any director, manager, officer, partner, , employee, agent, beneficiary or transferee of such company, firm or person or their dependents;
(b) directing any Bank, financial institution or person to freeze all moneys deposited with it or him on behalf of the company, firm or person or of any director manager, officer, partner or employee, agent, beneficiary or transferee of such company, form or person and deliver such moneys to the person appointed by it under clause (a);
(c) authorising a person appointed under clause (a) to take all necessary steps and measures for identifying the- assets and properties of the company, firm of person and for realisation, protection and preservation thereof;
(d) restraining any company, firm or person or any director, manager, officer, partner or employee or agent, beneficiary or transferee of such company, firm or person or their dependants or any other person deriving or claiming title through any of them from alienating, transferring, selling, assigning, disposing of or parting with possession of any property, movable or immovable, or deriving any benefit, rent or income therefrom; and
(e) making such orders for realisation, protection and preservation of deposits ofmoney and other assets and properties of the Company firm or person as it may deem fit;
(2) .........................
(3) .........................
(4) .........................
4. By Section 9, Section 43-B was also amended which reads as under:---(a) in subsection (1)---"(i) after the word "company", whenever occurring the comma and word, "firm" shall be inserted;
(ii) after the figure and comma "27-A, the words, figure, letter and comma "for is receiving or has received deposits of money in contravention of section 27," shall be inserted, and
(iii) for the full-stop at the end a colon shall be substituted and thereafter the following proviso shall be added, namely.-- "Provided that, in a case in which the State Bank has made an order under subsection (1) of section 43-AA in respect of a company, firm or person, the State Bank shall make a declaration under this subsection in respect of such company, firm or person within three months of the making of such order or within such further time not exceeding three months, in the aggregate, as the High Court may allow, or withdraw such order."
(b) for subsection (2) the following shall be substituted, namely:-- "(2)
5. It would appear on a plain reading of the proviso to Section 43-B that in a case in which State Bank has made an order under subsection (1) of Section 43---AA in respect of a company, firm or person; the State Bank shall make a declaration under this subsection in respect of such company, firm or person within such further time, not exceeding three months in the aggregate, as the High Court may allow or withdraw any such order.