compromised and a claim or right in favor of company may be released, extinguished or relinquished:] Provided that the acceptance by a banking company in the ordinary course of its business of deposits of money from the public repayable on demand or otherwise and withdraw able by cheque, draft, order or otherwise, or the placing of moneys or deposit by a banking company with another banking company on such conditions as the directors may prescribe, shall not bedeemed to be a borrowing of moneys or, as
Corporate Law (MGT 612) VU © Copyright Virtual University of Pakistan 153 the case may be, a making of loan by a banking company within the meaning of this section. 3. The directors of a public company or of a subsidiary of a public company shall not except with the consent of the general meeting either specifically or by way of an authorization, do any of the following things, namely.- a. sell, lease or otherwise dispose of the undertakings or a sizeable part thereof unless the main business of the company comprises of such selling or leasing; and b. remit, give any relief or give extension of time for the repayment of any debt outstanding against any person specified in sub-section (1) of section 195. 4. Whosoever contravenes any provision of this section shall be punishable with a fine which may extend to [one hundred thousand] rupees and shall be individually and severally liable for losses or damages arising out of such action. Section: 197 Prohibition regarding making of political contributions:- 1. Notwithstanding anything contained in this Ordinance, a company shall not contribute any amount — a. to any political party; or b. for any political purpose to any individual or body. 2. If a company contravenes the provisions of sub-section (1), then- i. the company shall be liable to a fine which may extend to ten thousand rupees; and ii. every director and officer of the company who is knowingly and wilfully in default shall be punishable with imprisonment of either description for a term which may extend to two years and shall also be liable to fine. 197-A. Prohibition regarding distribution of gifts:- 1. Notwithstanding anything contained in this Ordinance, a company shall not distribute gifts in any form to its members in its meeting. 2. If default is made in complying with this section, the company and every officer of the company who is a party to the default shall be liable to a fine not exceeding five hundred thousand rupees.]
Corporate Law (MGT 612) VU © Copyright Virtual University of Pakistan 154 Lecture 34 Chief Executive---Secretary Section: 198 Appointment of first chief executive:- 1. Every company other than a company managed by a managing agent shall have a chief executive appointed in the manner provided in this section and section 199.
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