Section 49: Winding up by High Court

49. Winding up by High Court.-- 1[(1) Notwithstanding anything contained in section 279, section 301 and section 428 of the Companies Act, 2017 (XIX of 2017), but without prejudice to its powers under the sub-section (1) of section 45 or the State Bank's powers under section 42E, 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 (2) 1[* 45, this section or section 59.] * * * * * *] (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; or 1[(iii) has been prohibited from receiving fresh deposits by an order under sub- section (5) of section 26A; 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 1[(aa) if an order has been made under section 42D and the State Bank has determined that it is appropriate that the banking company be wound up or part of the assets and liabilities of the banking company has been transferred to a transferee bank under section 42G or to a bridge bank under section 42H; 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 1[(iii) the continuance of the banking company is prejudicial to the stability of the financial system in Pakistan or the interest of its depositors.] (4) Without prejudice to the provisions contained in section 1[302 of the Companies Act, 2017 (XIX of 2017)] 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 1[the Companies Act, 2017 (XIX of 2017)], no Court shall entertain an application for winding up of 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 1[:] 1[Provided that notification shall be made to the State Bank of a filing for a winding up or an order made to that effect in relation to a company that controls or owns a substantial interest in a banking company or a subsidiary of a company that controls a banking company, or of a banking company. The official liquidator appointed over such an entity shall be under obligation to avoid any action that may frustrate the achievement of the objectives provided under section 42B and shall be under duty to coordinate with the State Bank in this respect.]

Effective date: 1962-06-07

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