"\u003chtml xmlns:o=\"urn:schemas-microsoft-com:office:office\"\r\nxmlns:w=\"urn:schemas-microsoft-com:office:word\"\r\nxmlns=\"http://www.w3.org/TR/REC-html40\"\u003e\r\n\r\n\u003chead\u003e\r\n\u003cmeta http-equiv=Content-Type content=\"text/html; charset=windows-1252\"\u003e\r\n\u003cmeta name=ProgId content=Word.Document\u003e\r\n\u003cmeta name=Generator content=\"Microsoft Word 9\"\u003e\r\n\u003cmeta name=Originator content=\"Microsoft Word 9\"\u003e\r\n\u003clink rel=File-List href=\"./2005J7003_files/filelist.xml\"\u003e\r\n\u003ctitle\u003eLEGAL ASPECTS OF MODARABAS IN PAKISTAN\u003c/title\u003e\r\n\u003c!--[if gte mso 9]\u003e\u003cxml\u003e\r\n \u003co:DocumentProperties\u003e\r\n  \u003co:Author\u003eAdministrator\u003c/o:Author\u003e\r\n  \u003co:Template\u003eNormal\u003c/o:Template\u003e\r\n  \u003co:LastAuthor\u003esaif\u003c/o:LastAuthor\u003e\r\n  \u003co:Revision\u003e2\u003c/o:Revision\u003e\r\n  \u003co:TotalTime\u003e1\u003c/o:TotalTime\u003e\r\n  \u003co:Created\u003e2005-10-18T07:00:00Z\u003c/o:Created\u003e\r\n  \u003co:LastSaved\u003e2005-10-18T07:00:00Z\u003c/o:LastSaved\u003e\r\n  \u003co:Pages\u003e7\u003c/o:Pages\u003e\r\n  \u003co:Words\u003e3238\u003c/o:Words\u003e\r\n  \u003co:Characters\u003e18459\u003c/o:Characters\u003e\r\n  \u003co:Company\u003eOratier Technologies (Pvt) Ltd.\u003c/o:Company\u003e\r\n  \u003co:Lines\u003e153\u003c/o:Lines\u003e\r\n  \u003co:Paragraphs\u003e36\u003c/o:Paragraphs\u003e\r\n  \u003co:CharactersWithSpaces\u003e22668\u003c/o:CharactersWithSpaces\u003e\r\n  \u003co:Version\u003e9.2720\u003c/o:Version\u003e\r\n \u003c/o:DocumentProperties\u003e\r\n\u003c/xml\u003e\u003c![endif]--\u003e\r\n\u003cstyle\u003e\r\n\u003c!--\r\n /* Font Definitions */\r\n@font-face\r\n\t{font-family:Garamond;\r\n\tpanose-1:2 2 4 4 3 3 1 1 8 3;\r\n\tmso-font-charset:0;\r\n\tmso-generic-font-family:roman;\r\n\tmso-font-pitch:variable;\r\n\tmso-font-signature:647 0 0 0 159 0;}\r\n /* Style Definitions 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class=Section1\u003e\r\n\r\n\u003cp class=MsoNormal align=center style=\u0027text-align:center\u0027\u003e\u003cb\u003eLEGAL ASPECTS OF\r\nMODARABAS IN PAKISTAN\u003co:p\u003e\u003c/o:p\u003e\u003c/b\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal align=center style=\u0027text-align:center\u0027\u003e\u003cb style=\u0027mso-bidi-font-weight:\r\nnormal\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/b\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal align=center style=\u0027text-align:center\u0027\u003e\u003cb style=\u0027mso-bidi-font-weight:\r\nnormal\u0027\u003eBY\u003co:p\u003e\u003c/o:p\u003e\u003c/b\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal align=center style=\u0027text-align:center\u0027\u003e\u003cb style=\u0027mso-bidi-font-weight:\r\nnormal\u0027\u003e\u003cspan style=\u0027letter-spacing:-.9pt;mso-bidi-font-style:italic\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/span\u003e\u003c/b\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal align=center style=\u0027text-align:center\u0027\u003e\u003cb style=\u0027mso-bidi-font-weight:\r\nnormal\u0027\u003e\u003cspan style=\u0027letter-spacing:-.9pt\u0027\u003eMr. \u003c/span\u003eSaalim Salam\u003cspan\r\nstyle=\u0027letter-spacing:-.9pt\u0027\u003e \u003c/span\u003eAnsari, Advocate, Karachi\u003co:p\u003e\u003c/o:p\u003e\u003c/b\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u0026quot;Modaraba\u0026quot; is a mode of\r\nnon-interest financing system based on investment and talent according to which\r\none party participates with skill(s) and other party participated with finance,\r\nthe party who participated with skill called as \u0026quot;Manager\u0026quot; or\r\n\u0026quot;Aamil\u003csup\u003e\u0026quot;\u003c/sup\u003e while the other person who invests through finance\r\ncalled the \u0026quot;Sponsor\u0026quot; or \u0026quot;Rab-ul-Mall\u0026quot;, in Modaraba one\r\nperson participates with skill(s) and other participates with finance, in fact\r\nit is to be called as Marriage of \u0026quot;brain\u0026quot; and \u0026quot;finance\u0026quot;.\r\nAccording to this financing system one person who cannot participate by\r\ninvesting the money and has no finance and only can use skill through finance\r\nof \u0026quot;Rab-ul-Maal\u0026quot;. The main point which is involved in the\r\n\u0026quot;Modaraba\u0026quot; mode of financing is that both of the parties will share\r\nthe profit but in case of fiscal loss, the \u0026quot;Manager\u0026quot; or\r\n\u0026quot;Aamil\u0026quot; will not suffer with financial losses, but \u0026quot;financer\u003csup\u003e\u0026quot;\u003c/sup\u003e\r\nor \u0026quot;Rab-ul-Maal\u003csup\u003e\u0026quot;\u003c/sup\u003e is under obligation to suffer financial\r\nlosses as he loses finance, which he used in the Modaraba arrangement. The\r\nconcept of Modaraba was available in Pre-Islamic era and it was not prohibited\r\nafter the Dawn of Islam. This mode is entirely based on a non-interest system\r\nof finance and in Modaraba\u0027s fiscal arrangement in which ideal Modaraba is the\r\ninstrument and/or product in interest free economic system in which there is no\r\nexploitation of skill(s) and talent(s) due to non-availability of funds and\r\nfinances. The Modaraba is a fiction of Law and Economics, which is to be called\r\nas marriage of brain and finance.\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003eIn Pakistan in the year 1980 when\r\nthe Modaraba Ordinance was promulgated about 70 to 100 Modarabas were floated\r\nthrough stock exchanges but in fact they worked on the interest based system. The\r\nModaraba Companies and Modaraba (Floatation and Control) Ordinance, 1980, which\r\nallowed to float the Modaraba(s) through stock exchange(s) and public\r\nsubscription(s) had collected the money in the name of Modarabas certificates.\r\nUnfortunately most of those Modarabas had failed due to reason(s).\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003eIn fact it is not failure of\r\nModaraba System but the failure of our present system based on corruption which\r\nin any case is interest based and in any case it is not the failure of the\r\n\u0026quot;Modaraba financing System\u0026quot;.\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003eA Division Bench of Sindh High\r\nCourt comprising Mr. Justice Mamoon Kazi and Mr. Justice Abdul Latif U. Qureshi\r\nhas defined the Modaraba in a reported judgment (1996 MLD 1273 Karachi) in the\r\ncase of Murtaza Flour Mills (Pvt.) Ltd. v. Federation of Pakistan that the term\r\nModaraba as defined in section 4 of Modaraba Companies and Modaraba (Floatation\r\nand Control) Ordinance, 1980 can be included in term \u0026quot;company\u0026quot;---Even\r\nif Modaraba could not qualify as company as defined in Banking Companies Ordinance,\r\n1962, yet no restriction has been imposed in regard to its inclusion in the\r\nSchedule of Banking Tribunals Ordinance, 1984---Mere fact that Modaraba can sue\r\nor be sued through Modaraba Company, would not lead to inference that claim\r\nrelating thereto could have been filed before Tribunal to be constituted under\r\nModaraba Companies and Modaraba (Floatation and Control) Ordinance, 1980 and\r\nnot before the Tribunal constituted under Banking Tribunals Ordinance,\r\n1984---Banking Tribunal, thus, has jurisdiction to try suits pending against\r\ncustomers filed by Modaraba Companies, therefore, a particular word or\r\nexpression has not been defined in a statute, resort may be had to it\u0027s\r\nordinary meaning.\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e[Reliance; Interpretation of\r\nStatutes by N.S. Bindra, 7th Edition, P-317; Black\u0027s Law Dictionary, 6th\r\nEdition, and Ballentine\u0027s Law Dictionary, 3rd Edition, P-232]\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003eIn the instant judgment it is\r\nfurther defined that section 2 of the said Ordinance defines\r\n\u0026quot;Modaraba\u0026quot; to mean as \u0026quot;a business in which a person participates\r\nwith his money and another with his efforts or skill or both his efforts and\r\nskill and include Unit Trusts and Mutual Funds. by whatever name called\u0026quot;.\r\n\u0026quot;Modaraba Company\u0026quot;, according to section 2(c) means \u0026quot;a company\r\nengaged in the business of floating and managing Modaraba.\u0026quot; Clause (d) of\r\nsection 2 also defines \u0026quot;Modaraba Fund\u0026quot; to mean as \u0026quot;a fund raised\r\nthrough floatation of Modaraba.\u0026quot; Section 5 of the said Ordinance provides\r\nthat a company shall be eligible for registration as a Modaraba Company in case\r\nit fulfils the conditions laid down in clauses (a) to (f) of the said\r\nconditions. Reference to the said conditions is not necessary not being germane\r\nto the questions requiring determination in this case. Section 7 of the\r\nOrdinance of 1980 lays down that Modaraba may be of two descriptions, viz., Multipurpose\r\nModaraba, that is to say, a Modaraba having more than one specific purpose or\r\nobjective, and Specific purpose of Modaraba, that is to say, a Modaraba having\r\none specific purpose of objective. According to subsection (2) of section 7; a\r\nModaraba may be either for a fixed period or for an indefinite period. Section\r\n8 requires a Modaraba Company to apply to the Registrar for permission to float\r\nModaraba section 12 of the Ordinance of 1980 provides that:\u0026#8209;\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify;text-indent:.5in\u0027\u003e\u003csup\u003e\u0026quot;\u003c/sup\u003e12-\u0026#8209;\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-left:.5in;text-align:justify\u0027\u003e(1) A Modaraba\r\nshall sue and be sued in its own name through the Modaraba Company.\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-left:.5in;text-align:justify\u0027\u003e(2) The assets\r\nand liabilities of each Modaraba shall be separate and distinct from those of\r\nanother Modaraba as also from those of the Modaraba Company\u0026quot;.\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003eSection 24 of the said Ordinance\r\n(the Modaraba Ordinance), provides for constitution of Tribunals for the\r\npurpose of the said Ordinance. Section 25 of the said Ordinance refers to the\r\npowers of a Tribunal which may be established under the said Ordinance and provides\r\nas follows:\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify;text-indent:.5in\u0027\u003e\u0026quot;25---\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003cspan style=\u0027mso-tab-count:1\u0027\u003e??????????? \u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify;text-indent:.5in\u0027\u003e(1) A Tribunal\r\nshall:\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-left:.5in;text-align:justify\u0027\u003e(a) In the\r\nexercise of its civil jurisdiction, have in respect of a claim filed by a\r\nholder of Modaraba Certificates against the Modaraba Company or by Modaraba\r\nCompany against any other party with whom it has entered into business\r\ntransactions relating to Modaraba Fund, or in respect of an application by the\r\nRegistrar for the winding \u003cspan style=\u0027font-size:9.0pt\u0027\u003eup \u003c/span\u003eof a Modaraba\r\nCompany, all the powers vested in a Civil Court under the Code of Civil\r\nProcedure, 1908.\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-left:.5in;text-align:justify\u0027\u003e(b) In the\r\nexercise of its criminal\u0027 jurisdiction, try the offences punishable under this\r\nOrdinance and shall, for that purpose, have the same powers as are vested in\r\nthe Court of \u003cspan style=\u0027font-size:9.0pt\u0027\u003ea \u003c/span\u003eSessions Judge under the\r\nCode of Criminal Procedure, 1898.\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-left:.5in;text-align:justify\u0027\u003e(c) Exercise and\r\nperform such other powers and functions as are, or may be conferred upon or\r\nassigned to it by or under this Ordinance.\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify;text-indent:.5in\u0027\u003e(2)------------\u003cspan\r\nstyle=\u0027mso-tab-count:1\u0027\u003e? \u003c/span\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-left:.5in;text-align:justify\u0027\u003e(3) No Court\r\nother than the Tribunal shall have or exercise any jurisdiction with\u0027 respect\r\nto any matter to which the jurisdiction of the Tribunal extends under this Ordinance.\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003eReference may also be made to\r\nsection 26 of the said Ordinance (The Modaraba Ordinance), which provides for\r\nprocedure to be followed by such Tribunal established under the said Ordinance.\r\nThe said section provides as follows:--\u0026quot;26--\u0026#8209;\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-left:.5in;text-align:justify\u0027\u003e(1) Matters\r\nbefore the Tribunal shall come up for regular hearing as expeditiously as\r\npossible and, except in extraordinary circumstances and on grounds to be\r\nrecorded, the Tribunal shall hear the cases from day to day.\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-left:.5in;text-align:justify\u0027\u003e(2) In the exercise\r\nof it\u0027s civil jurisdiction, the Tribunal shall, in all suits before it,\r\nincluding suits for recovery of money, follow the summary procedure provided\r\nfor in Order XXXVII of the First Schedule to the Code of Civil Procedure,\r\n1908.\u0026quot;\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-left:.5in;text-align:justify\u0027\u003e\u0026quot;42. The\r\nprovisions of this Ordinance shall have effect notwithstanding anything\r\ncontained in the Companies Act, 1913 or any other law for the time being in\r\nforce.\u0026quot;\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003eThe Division Bench of Sindh High\r\nCourt had further elaborated that \u0026quot;no doubt, the definition of\r\n\u0026quot;Modaraba\u0026quot; in section 2(a) of the Ordinance, 1980 (the said clause is\r\nnow (ab) after amendment) indicates that Modaraba only means a business or\r\nscheme in which one person participates with his money and other with his\r\nefforts or skill or both his efforts and skill and the same does not fall\r\nwithin the definition of the word \u0026quot;company\u0026quot; as defined either in the\r\nBanking Companies Ordinance, 1962 or the Companies Ordinance, 1984 but as it\r\nindicated by the above Dictionary meanings of the term \u0026quot;company\u0026quot; an\r\nestablishment to qualify as a company may not conform to the definition of the\r\nsaid term as given in the said Ordinances.\u0026quot;\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-left:.5in;text-align:justify\u0027\u003e\u0026quot;The\r\nexpression \u0026quot;Modaraba Fund\u0026quot; has also been defined in the said\r\nOrdinance to mean as \u0026quot;a fund raised through floatation of Modaraba.\u0026quot;\r\nSection 12 of the Ordinance of 1980, reference to which was also made earlier\r\nin this judgment, further indicates that a Modaraba shall sue and be sued in\r\nits own name through the Modaraba Company. Subsection (2) of the said section\r\nfurther provides that the assets and liabilities of each Modaraba shall be\r\nseparate and distinct from those of another Modaraba as also from those of the\r\nModaraba Company. The aforesaid provisions, therefore, indicate that\r\n\u0026quot;Modaraba\u0026quot; is a business in the nature of partnership and \u0026quot;Modaraba\r\nCompany\u0026quot; is a company which may be engaged in the business of floating and\r\nmanaging Modaraba. A fund which may be raised through floatation of Modaraba\r\nhas been defined in \u0026quot;Modaraba Fund\u0026quot; by the said Ordinance. Although\r\nthere appear to be no restrictions on any company floating or managing more\r\nthan one Modaraba but as is indicated by section 12, each Modaraba would be a\r\nseparate legal entity which may sue or be sued in its own name although,\r\nthrough the Modaraba Company. Section 25 of the said Ordinance indicates that a\r\nTribunal constituted under the said Ordinance has been vested with jurisdiction\r\nto determine a claim filed by a holder of Modaraba Certificates against the\r\nModaraba Company or by a Modaraba Company against any other party with whom it\r\nhas entered into business transactions relating to Modaraba Fund or in respect\r\nof matters relating to winding up of a Modaraba Company but the provisions of\r\nsection 25 nowhere indicate that further power has been conferred on a Tribunal\r\nto try any claim that may be instituted by a Modaraba against any other party,\r\nmay be the transaction relates to Modaraba Fund. No doubt, subsection (3) of\r\nsection 25 further indicates that the Tribunal so established shall exercise\r\nexclusive jurisdiction in the matters as indicated by subsection (1) thereof by\r\nplacing restriction upon the exercise of such power by any other Court or\r\nTribunal and subsection (2) of section 26 further indicates that the Tribunal\r\nhas been vested with jurisdiction to try suits, including suits for recovery of\r\nmoney but since, as has .been pointed out earlier, the exclusive jurisdiction\r\nvested in the Tribunal only relates to matters specified in subsection (1) of\r\nsection 25. Although the said subsection indicates that the Tribunal has been\r\nvested with power to try claims\u0027 instituted by \u003cspan style=\u0027font-size:15.0pt;\r\nfont-family:Garamond;mso-bidi-font-family:Garamond\u0027\u003ea \u003c/span\u003eModaraba Company\r\nin relation to Modaraba Fund, but such claims cannot include claim filed by\r\nModaraba as in the present case, since a Modaraba is a separate legal entity as\r\nindicated by section 12 of the Ordinance of 1980, as it can sue and be sued in\r\nits own name. The mere fact that a Modaraba can sue or be sued through the\r\nModaraba Company does not lead to an inference that the claims instituted in\r\nthe present case against petitioners could have been filed before a Tribunal to\r\nbe constituted under the Ordinance of 1980. If such was the legislative intent,\r\nthe same would have been clearly expressed in the said Ordinance. On the other\r\nhand, the Legislative in its own wisdom by enlarging the definition of\r\n\u0026quot;banking company\u0026quot; in section 2(a) of the Banking Tribunals Ordinance\r\nof 1984 and vesting the Federal Government with power under section 13 of the\r\nsaid Ordinance clearly intended to confer powers on the Tribunal constituted\r\nunder such special enactment to try all cases relating to finance between the\r\nestablishments included in the said Schedule and a customer, we are\r\nconsequently, of the view that the Banking Tribunal has jurisdiction to try the\r\nsuits pending against the petitioners. We, therefore, find no force in this\r\npetition.\u0026quot;\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003eInclusion of\r\n\u0026quot;Modarabas\u0026quot; and/or \u0026quot;Modaraba Companies\u0026quot; in the Schedule of\r\nBanking Tribunals Ordinance, 1984 (Now replaced by the Financial Institutions\r\n(Recovery of Finances) Ordinance, 2001), vests Banking Tribunals (Now Banking\r\nCourts) with exclusive jurisdiction to try claims filed by Banking Companies\r\nagainst customers---Specified procedure has been prescribed for resolution of\r\nsuch claims and appeals filed against any order, decree or sentence passed by\r\nthe Banking Tribunal (Now Banking Courts).\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003ePerusal of the above has shown\r\nthat one Modaraba Management Company can float many Modarabas like Messrs.\r\nPrudential Modaraba Management Co. (Pvt.) Ltd; had floated 1st, 2nd and 3rd\r\nPrudential Modarabas as \u0026quot;Modaraba\u0026quot; has been created by virtue of\r\nfiction of law as well as it has been declared a legal person and controversy\r\nwere dissolved in the cited reported judgment of Sindh High Court passed by Mr.\r\nJustice Mamoon Kazi and Mr. Justice Abdul Latif U. Qureshi in the case of\r\nMurtaza Flour Mills Ltd. v. Federation of Pakistan reported as 1996 MLD 1273\r\n(D.B.) according to which five (5) writ petitions were disposed off.\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003eIt is also provided in section 30\r\nof Ordinance that any person aggrieved by any order, judgment decree or\r\nsentence of the Modaraba Tribunal, may, within thirty days of such order,\r\njudgment decree or sentence, prefer an appeal to the High Court within whose\r\njurisdiction the order, judgment, decree or sentence is passed. It was further\r\nprovided that no appeal shall lie from an interlocutory order which does not\r\ndispose of the entire case before the Modaraba Tribunal.\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u0026quot;Modarabas\u0026quot; are\r\ngoverned by the Securities and Exchange Commission of Pakistan (SECP) and not\r\nunder the direct supervision of State Bank of Pakistan and/or in view of the\r\nabove, the proviso of sections 25 and 33-B of the Banking Companies Ordinance,\r\n1962, will apply and/or the directives/circulars of State Bank of Pakistan are\r\nalso applicable to the Modarabas.\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003eThat by virtue of the Financial\r\nInstitutions (Recovery of Finances) Ordinance, 2001, the definition of\r\n\u0026quot;Financial Institutions\u0026quot; and \u0026quot;finance\u0026quot; have been defined\r\nand the \u0026quot;Modaraba\u0026quot; has been declared as Financial Institution, the\r\nFinancial Institutions (Recovery of Finances), Ordinance of 2001 is an Ordinance\r\nto repeal, and, with certain modifications, re-enact, the Banking Companies\r\n(Recovery of Loans, Advances, Credits and Finances) Act XV of 1997 and\r\npromulgated on 30th August, 2001 and in the definition 2(a) and 2(d) the\r\n\u0026quot;financial institutions\u0026quot; and \u0026quot;finance\u0026quot; defined as:\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify;text-indent:.5in\u0027\u003e(a) \u0026quot;Financial\r\ninstitution\u0026quot; means and includes:--\u0026#8209;\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-left:.5in;text-align:justify\u0027\u003e(i) Any company\r\nwhether incorporated within or outside Pakistan which transacts the business of\r\nbanking \u003cspan style=\u0027font-size:9.0pt;letter-spacing:.8pt;mso-bidi-font-style:\r\nitalic\u0027\u003eor any \u003c/span\u003eassociated or ancillary business in Pakistan through its\r\nbranches within or outside Pakistan and includes a Government savings bank, but\r\nexcludes the State Bank of Pakistan.\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-left:.5in;text-align:justify\u0027\u003e(ii) \u003cu\u003eA\r\nmodarba or modarba management company\u003c/u\u003e, leasing company, investment bank,\r\nventure capital company, financing company, unit trust or mutual fund of any\r\nkind and credit or investment institution, corporation or company; and\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-left:.5in;text-align:justify\u0027\u003e(iii) Any\r\ncompany authorized by law to carry on any similar business, as the Federal\r\nGovernment may by Notification in the official Gazette, specify.\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify;text-indent:.5in\u0027\u003e(d)\r\n\u0026quot;Finance\u0026quot; includes:--\u0026#8209;\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-left:1.0in;text-align:justify;text-indent:\r\n-.5in;mso-list:l0 level1 lfo1;tab-stops:list 1.0in\u0027\u003e\u003c![if !supportLists]\u003e(i)\u003cspan\r\nstyle=\u0027font:7.0pt \"Times New Roman\"\u0027\u003e\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\u0026nbsp;\r\n\u003c/span\u003e\u003c![endif]\u003eAn accommodation or facility provided on the basis of\r\nparticipation in profit and loss, mark-up or mark-down in price, hire-purchase,\r\nequity support, lease, rent-sharing, licensing charge or fee of any kind,\r\npurchase and sale of any property including commodities, patents, designs, trade\r\nmarks and copy-rights, bills of exchange promissory notes or other instruments\r\nwith or without buy-back arrangement by a seller, participation term\r\ncertificate, musharika, morabaha, musawama, istisnah or \u003cu\u003emodaraba certificate\u003c/u\u003e,\r\nterm finance certificate.\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003eThe offences defined in sections\r\n4, 10, 13, 14, 16 or 17 of Modaraba Ordinance, 1980 shall be punishable with\r\nimprisonment of either description for a term which may extend to three (3)\r\nyears and with fine which may extend to five hundred thousand rupees, therefore,\r\nthe contravention referred to in subsection (1) has caused loss to the Modaraba\r\nor any other person, a further fine to the extent of the loss shall be imposed.\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003eThat under section 25 subsection\r\n(1) clause (b) of Modaraba Ordinance, 1980 has provided that criminal\r\nproceedings be initiated under Code of Criminal Procedure, 1898, and it\u0027s\r\nhaving the same power and are vested in the Sessions Court and/or it has to\r\nfollow Cr.P.C. while exercising criminal jurisdiction under section 31 of\r\nModaraba Ordinance, 1980 regarding punishment(s) which runs as:\u0026#8209;\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-left:.5in;text-align:justify\u0027\u003eSection 31---\u003cb\r\nstyle=\u0027mso-bidi-font-weight:normal\u0027\u003e\u003cu\u003ePunishment\u003c/u\u003e\u003c/b\u003e. (1) Whoever\r\ncontravenes the provisions of sections 4, 10, 13, 14, 16 or 17 shall be\r\npunishable with imprisonment of either description for a term which may extend\r\nto three years and with fine which may extend to five hundred thousand rupees.\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-left:.5in;text-align:justify\u0027\u003eWhere the\r\ncontravention \u0027 referred to in subsec?tion (1) has caused loss to the modaraba\r\nor any other person, a further fine to the extent of the loss shall be imposed.\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-left:.5in;text-align:justify\u0027\u003eThat under\r\nsection 30 of Modaraba Ordinance, 1980, an appeal against Modaraba Tribunal was\r\nprovided under subsection (1); which runs as;\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-left:.5in;text-align:justify\u0027\u003eSection 30\r\n(1):---Any person aggrieved by any order, judgment, decree or sentence of the\r\nTribunal may, within thirty days of such order, judgment, decree or sentence,\r\nprefer an appeal to the High Court within whose jurisdiction the order,\r\njudgment, decree or sentence is passed:\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027margin-left:.5in;text-align:justify\u0027\u003eProvided that no\r\nappeal shall lie from an interlocutory order which does not dispose of the\r\nentire case before the Tribunal.\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003eAlthough the \u003csup\u003e\u0026quot;\u003c/sup\u003eModarabas\u0026quot;\r\nare governed by the Securities and Exchange Commission of Pakistan (SECP) and not\r\nunder the direct supervision of State Bank of Pakistan but in view of the\r\nabove, the provisions of sections 25 and 33-B of the Banking Companies\r\nOrdinance, 1962, will apply and/or the directives/circulars of State Bank of\r\nPakistan are also applicable to the Modarabas.\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003eThe SBP\u0027s BPD\u0027s Circular No.29 of\r\n2002 and/or subsequent State Bank\u0027s circulars are also applicable to the\r\nleasing companies and Modaraba(s) as under section 2(d) of the Financial\r\nInstitutions (Recovery of Finances) Ordinance, 2001 the \u0026quot;lease\u0026quot;,\r\n\u0026quot;modaraba\u0026quot;, \u0026quot;Hire and Purchase\u0026quot; and \u0026quot;modaraba\r\ncertificates\u0026quot; fall within the definition of \u0026quot;finance\u0026quot; and under\r\nsection 2(a), the \u0026quot;leasing companies\u0026quot; and/or \u0026quot;modarabas\u0026quot;\r\nare covered within the definition of \u0026quot;financial institution(s)\u0026quot;. It\r\nis needless to say that Financial Institutions (Recovery of Finances)\r\nOrdinance, 2001 was enforced in replacement of Banking Companies (Recovery of\r\nLoans), Advances, Credits and Finances) Act XV of 1997 in which \u0026quot;Leasing\r\nCompanies\u0026quot;, \u0026quot;Modaraba(s)\u0026quot; as well as \u0026quot;Investment\r\nBank(s)\u0026quot; were also covered under the definition of the \u0026quot;Banking\r\nCompany\u0026quot;.\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003eSections 25 and 33-B of Banking\r\nCompanies Ordinance, 1962 have covered the word \u0026quot;finances\u0026quot; pertains\r\nto the \u0026quot;financial institutions\u0026quot; who granted the loans and/or advances\r\nand in view of reported judgments, 2004 CLD 257 (Tristar\u0027s case) and 2002 CLD\r\n542 (Messrs Azmat Textile\u0027s case); PLD 1997 SC 315 (Hashwani Hotel\u0027s Case); PLD\r\n1999 SC 1026 (Shaukat Ali Mian\u003csup\u003e\u0027\u003c/sup\u003es case); 2002 CLC 166 (Dadabhoy\r\nCement Industries Ltd. v. NDFC) upheld by the apex Court of Pakistan in PLD\r\n2002 SC 500. It is held that sections 25 and 33-B of the Banking Companies\r\nOrdinance, 1962 are applicable on all the Banking Companies who are involved in\r\nrespect of grant of advance(s) and/or loan(s), even these are applicable on\r\nCIRC,. who as per section 19 of CIRC Ordinance, 2000 is not a banking company,\r\nbut has adopted the scheme of SBP\u0027s BPD\u0027s Circular No. 29 of 2002. In a CIRC\u003csup\u003e\u0027\u003c/sup\u003es\r\ncase (UBL v. Bawany Spinning Mills (Pvt.) Limited), Mr. Justice Maqbool Baqar\r\nof Sindh High Court has held that \u0026quot;spirit behind the Circular-29 will be\r\nadopted for all the practical purposes\u0026quot;. Further in the case reported as\r\n2005 CLD 422, 2005 CLD 114, 2005 CLD 169 (D.B.) (upheld by Supreme Court of\r\nPakistan in 2004 SCMR 1956) it is held that SBP\u0027s Circular -29 of 2002 is\r\napplicable in CIRC cases.\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003eIn view of the above, it is\r\nnecessary and/or practical that a subsequent circular is advised to be issued\r\nwhich shall clarify that the SBP\u0027s scheme is applicable to\r\n\u0026quot;Modarabas\u0026quot;, \u0026quot;Leasing Companies\u0026quot; and \u0026quot;Investment\r\nBanks\u0027 as the \u0026quot;Myth behind the incentive circular(s) is applicable to\r\nModaraba(s), Leasing Companies and Investment Banks\u0026quot; as a clarification to\r\nthat extent be also issued by SECP which declares that \u0026quot;spirit of the said\r\nSBP\u0027s circular(s) may be followed by the \u0026quot;Modaraba(s)\u003csup\u003e\u0026quot;\u003c/sup\u003e, \u003csup\u003e\u0026quot;\u003c/sup\u003eLeasing\r\nCompanies\u0026quot; and \u0026quot;Investment Bank(s)\u003csup\u003e\u0026quot;\u003c/sup\u003e to the extent of\r\n\u0026quot;case to case basis\u0026quot;.\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003eSBP\u0027s Incentive Scheme announced\r\nvide SBP\u0027s Circular-29 of 2002 is a very useful and workable scheme in which\r\nincentive(s) for loan\u0027s write-off has been given by adopting the practical\r\napproach and by introducing the scheme based on theory \u0026quot;Buy your own\r\nsecurities on Forced Sale Value\u0026quot;. The benefit of the scheme will be that a\r\nreasonable and/or sizeable amount will be recovered as under the scheme more\r\nthan 45,000 borrowers had applied and more than 1000 complaints have been filed\r\nbefore SBP\u0027s Committee. Further not only the bad debts \u003cspan style=\u0027font-family:\r\nGaramond;mso-bidi-font-family:Garamond;letter-spacing:.2pt\u0027\u003ewill \u003c/span\u003ebe\r\ncleared as well as the burden of suits/cases and appeals on the Banking Courts\r\nand superior Courts will be relieved, due to the instant out of Court\r\nsettlement\u0027s scheme.\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003eThe failure of Modaraba Sector in\r\nPakistan is not the failure of the principle(s) and/or system of Modaraba(s),\r\nwhich is a non-interest system, it is the failure of our present system, based\r\non corruption and/or interest as the Modem Western World is adopting the system\r\nof Non-interest Modaraba System, while in Pakistan, we indulge ourselves in\r\ndebate whether the Modaraba, Musharika and other mode of non-interest\r\nfinancing, banking and Interest Free Economy is feasible and/or practical or\r\nnot.\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003eIt is the need of the time that\r\nreforms in Modaraba System be made and/or Legal Structure of Modaraba(s) be\r\nmodified by modification of Modaraba Ordinance, 1980 as well as strict\r\nsupervisory jurisdiction of SECP and State Bank of Pakistan be regulated as the\r\nfuture pertains to Modaraba(s).\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003eBy encouraging Modarabas Sector\r\nand Modaraba System, our society and economy can progress and talent(s) as well\r\nas skill(s) can be utilized for Economic Progress.\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal style=\u0027text-align:justify\u0027\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003cp class=MsoNormal\u003e\u003c![if !supportEmptyParas]\u003e\u0026nbsp;\u003c![endif]\u003e\u003co:p\u003e\u003c/o:p\u003e\u003c/p\u003e\r\n\r\n\u003c/div\u003e\r\n\r\n\u003c/body\u003e\r\n\r\n\u003c/html\u003e\r\n"