SYED HAIDER ALI PIRZADA, J.-1. This is a petition under sub-section (2) read with sub-section (1) of Section 43-F of the Banking Companies Ordinance, 1962 (VII of 1962) (hereinafter called the 'Ordinance') made by the State Bank of Pakistan in which the following reliefs have been prayed for:- "l. To make an order for winding up the Aim International by the Court.
2. To appoint Mr. Asad Ali Bilgrami, Advocate, Press Centre, Karachi as an official liquidator for the purpose of such winding up:
3. To award cost of this petition to the petitioner, in the circumstances of the case.
4. To dispense with the advertisement of petition and notice to the creditors at this stage being unnecessary as held in J.M. No. 5/1980 by this Honourable High Court on 2nd February, 1981.
5. To pass such other orders as may be deemed fit in the circumstances."
2. The facts leading to the filing of the above petition are that Aim International (hereinafter referred to as the 'firm) being a partnership firm consisting of two partners having joined on It July, 1985 registered under the Partnership Act, 1932. The certificate of registration is annexed to the petition as annexure 'A'. The registered office of the firm is situated at Room No. 53, Habib Chambers, University Road, Karachi. The objects of the firm include general trading, rent a car and transport or any other trade as may be mutually agreed upon by the partners as set forth in the Deed of Partnership dated 30th November, 1985. A photostat copy of the Deed of Partnership is annexed to the petition as annexure^'IT. The object for which the firm was established was not banking business nor it was registered as a banking company.
3. Sub-section (1) of Section 27 of the Ordinance provides inter alia that no individual not being a company, shall carry on banking business in Pakistan, and the above named firm is not a company.
4. The case of the petitioner as set out in the petition is that on coming to know through press and otherwise that the firm was suspected of doing banking business illegally in contravention of Section 27(1) of the Ordinance, directive No. BID. (INSP)/579/604-A-87 dated 6th April, 1987 under Section 43-A of the Ordinance was served upon the firm. The firm's registered office was inspected by the officers of the petitioner and copies of certain documents were taken into custody by the officers of the petitioner. These documents, inter alia, consist of photo stat copies of agreements entered into between the firm and the partners (depositors) evidencing acceptance of deposits and photo stat copy of list of investors evidencing acceptance of investment deposits to the tune of Rs. 7,05,000/- between It April, 1987 to 30th June, 1987 and refund of investment of Rs. 10,000/- to one Masood Akhtar Javed, balance sheet as on 30th June, 1987 evidencing an investment of Rs.
5,50,000/- in Tiger Group of Industries, profit and loss account as on 30th June, 1987 indicating, inter alia share of profit on the investment made with Tiger Group of Industries, copy of agreement dated 4th January, 1987 entered into between the firm and Tiger Group of Industries for financing the business of the , latter.
5. It is the case of the petitioner that since the aforesaid documents prima facie called for action under Section 43-B (1) of the Ordinance, a show cause notice dated 28th May, 1988 along with the annexures was sent to the firm at its registered office through pre-paid registered post with acknowledgement due as required by law. The copy of show cause notice is annexed to the petition as annexure 'D/
6. By notice the firm was notified that the petitioner was prima facie of the opinion that it was doing banking business in contravention of Section 27(1) of the Ordinance and the petitioner proposed to make a declaration to the effect under Section 43-B (1) of the Ordinance and that before doing so, the firm was given an opportunity of showing cause against the proposed declaration within seven days from the date of receipt of the notice, failing which an ex parte decision would be made. It is stated in the petition that neither the said notice was returned undelivered nor the postal acknowledgement was received.
7. The firm sent its reply vide its letter date It June, 1988 wherein it contended that the firm is not hit by the provisions of the Ordinance and it is not indulging in illegal business which contravenes Section 27(1) of the Ordinance nor it is doing any illegal banking business. It is the case of the petitioner that apart from the above, it did not aver anything in its defence with regard to the documents annexed to the show cause notice evidencing lending/investment of funds collected by it from public. It is the further case of the petitioner that the firm has not brought on record any documentary evidence to contradict the variety of the documents relied upon by the petitioner.
The copy of the reply is annexed to the petition as annexure 'G'.
8. The case of the petitioner is that as the reply of the firm to the show cause notice was not satisfactory and it could not and did not controvert the evidence of acceptance of deposits from the public, the withdrawal of investment, the investment/lending of such deposits to enterprises other than its own, the petitioner Bank was/is of the opinion that the firm was/is transacting banking business in contravention of Section 27(1) of the Ordinance and therefore the petitioner made a declaration to that effect on 13th July, 1988 under Section 43-B (1) of the Ordinance and got it published in the Daily 'Dawn' dated 19th July, 1988 as required under Section 43-B (2) of the Ordinance. The copy of the declaration and the publication of the declaration in the Daily newspaper 'Dawn' dated 19th July, 1988 are annexed to the petition as annexures 'I' and 'J'. The consequence of which according to Section 43-C of the Ordinance is that the firm ceased to function or to transact business and any transaction with the firm or with any person acting or purporting to act for and on behalf of the firm on or after the publication of the said declaration shall be void.
9. I would tum to Section 43-F. It reads as follows:-- "43-F. Consequential provisions for winding up, etc.--(l) Where the declaration made under sub- section (1) of Section 43-B is in respect of a person other than an industrial or a company, such person shall, irrespective of the number of members of which it consists, be deemed to be an unregistered company which may be wound up under Part IX of the Companies Act, 1913 (VII of 1913).
(2) Where the person in respect of which a declaration has been made under sub-section (1) of Section 43-B is a company or an unregistered company, the High Court shall, upon an application made by the State Bank within seven days of the publication of the declaration in pursuance of sub-section (2) of Section 43-B, or within such further time as the Federal Government may allow, make an order for the winding up of the company or the unregistered company.
(3) The provisions of Part III, other than those of Sections 45 to 49 and 59, and Part IV shall, insofar as they relate to winding up of a banking company, apply to an application made under subsection (2) and to the winding up proceedings following such application.
(4) Notwithstanding anything contained in the Provincial Insolvency Act, 1920 (V of 1920), and the Insolvency (Karachi) made under sub-section (1) of Section 43-B in respect of an individual shall constitute an effective ground for adjudging the individual an insolvent and the court competent to adjudge him as insolvent shall, upon an application made by the State Bank within seven days of the publication of the declaration in pursuance of sub-section (2) of Section 43-B, or such further time as the Federal Government may allow, pass an order of adjudication against such individual without further proof and follow thereafter the provisions of the Provincial Insolvency Act, 1920 (V of 1920) or, as the case may be, the Insolvency (Karachi Division) Act (III of 1909), for the administration and distribution of the property of the insolvent: Provided that the court shall not have the power to subsequently annul the adjudication or accept any composition or scheme or arrangement".
10. Section 91-A of the above Ordinance provides that the provisions of Part 11-A of the Ordinance shall have effect notwithstanding any other law, contract, agreement, award etc.
11. Accordingly, the petitioner presented the above petition on 21st July, 1988, i.e. Within seven days of the publication of the aforesaid declaration for the compulsory winding up of the firm as an unregistered company.
12. In the instant case, the petitioner after complying with all the requirements of the Ordinance issued declaration to the effect that the firm in question has contravened the provisions of Section 27 (1) of the Ordinance. Such a declaration was duly published in terms of sub-section (2) of Section 43-B of the Ordinance in the issue dated 19th July, 1988 in Daily 'Dawn' Karachi.
13. In the present case the declaration was duly published on 19th September, 1988 and .The petition was presented as stated earlier hereinabove on 21st July, 1988. The case has not been contested by the firm and I order winding up of Aim International as an unregistered company. I appoint Mr. S. Asad Ali Bilgrami, Advocate as official liquidator. The cost of the petition shall be paid out of the assets of the unregistered company.