Through proposed amendments to the Corporate Rehabilitation Bill, 2017, the corporate sector would be entitled to approach courts in certain situations prescribed in section 17 (dismissal of a case) of the Bill, 2017. The committee has directed Securities and Exchange Commission of Pakistan (SECP) to submit the final draft of amendments in the Corporate Rehabilitation Bill, 2017 by August 31, 2017 to ensure rehabilitation and reorganization of distressed corporate entities.
The committee had further considered the bill to provide for rehabilitation and reorganization of distressed corporate entities [The Corporate Rehabilitation Bill, 2017] introduced in the House on January 19, 2017 and referred to the committee for consideration and report. He said that the FBR has not yet submitted rules on the Benami Transaction (Prohibition) Act, 2015 required for effective enforcement of the Benami Law.
The amendment proposed by committee in section 17 (dismissal of a case) of the Corporate Rehabilitation Bill, 2017:
17. Dismissal of a case.- (1) Notwithstanding anything to the contrary in this act, the court may, on the application of any person concerned with the debtor or on its own accord, dismiss a case or may suspend all proceedings in a case under this act at any time, if the court determines that,-
(a) The continuation of proceedings would amount to an abuse of the judicial process;
(b) The person filing the petition has failed to provide the necessary funds for mediation after getting due opportunity in this regard; and
(c) The mediator has not been able to fully perform one or more of the functions specified in section 10 within a period of twelve months form his appointment.
(2) Unless the court for any reason orders otherwise, the dismissal of a case;
(a) Reinstates any proceeding or custodianship superseded under this act; any transfer avoided under this act; and any charge voided under this Act;
(b) Vacates any order or transfer ordered under this act; and re-vests the property of the estate in such person in which such property was vested immediately before the commencement of the case under this act.
The committee has also proposed insertion of new sections after section 38: Section 41. Act to override other laws, contracts, instruments, memorandum and articles.- Save as otherwise expressly provided in this act, the provisions of this act shall have effect notwithstanding anything to the contrary contained in any other law, contract, instrument, memorandum or articles of a company or in any agreement executed by a company or in any resolution passed by the company in a general meeting or by its directors, whether the same is registered, executed or passed, before or after the commencement of this act.
Proposed Section 42. (Limitation).- (1) Except as provided otherwise in this Act, the provisions of the Limitation Act, 1908 (IX of 1908) shall apply to the proceedings under this Act.
(2) Notwithstanding anything contained in the Limitation Act, 1908 (IX of 1908), in computing the time within which an administrator may institute a suit for the recovery of any debt due to the debtor, the period which elapses between the filing of a petition under this act and the passing of an order for relief under this act or a period of one year, whichever be greater, shall be excluded.
Section 43: (Power to require delivery of properly).- Without prejudice to any obligation imposed under any other provision, the court may at any time after passing an order of relief under this act require any trustee, receiver, banker, agent, officer or employee or former officer or employee or auditor of the debtor to pay, deliver, convey, surrender or transfer forthwith or within such time as the court directs, to the administrator, if one has been appointed, any money, property or books and papers including documents in his hands to which the debtor is prima facie entitled, which is not subject to any charge.
Copyright Business Recorder, 2017