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Short title.
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1. This Ordinance may be cited as the Bank of Ceylon Ordinance.
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Establishment of bank.
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2. A bank to be called the Bank of Ceylon is hereby established.
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Incorporation of bank.
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3. The bank shall be a body corporate with perpetual succession and a common seal and may sue and be sued in its corporate name.
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4. The central office of the bank shall be at Colombo in Sri Lanka.
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Branches and agencies.
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5. The bank may establish and maintain-
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(a) agencies in any part of the world ;
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(b) branches in Sri Lanka or elsewhere.
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Board of directors of the bank.
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6.
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(1) The management and administration of the affairs of the bank shall be vested in a board, consisting of six directors appointed by the Minister, one of whom shall be a representative of the Ministry charged with the subject of Finance (hereinafter referred to as the ” ex officio director “).
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(2) The board may exercise, discharge or perform the powers, functions or duties of the bank for the purpose of carrying on the business, and administering the affairs, of the bank.
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(3) No act or proceeding of the board shall be invalid by reason only of the existence of any vacancy among the directors or any defect in the appointment of a director or authorization by the ex officio director under subsection (8).
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(4) A Member of Parliament shall not be qualified to be a director.
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(5) The Minister shall appoint one of the appointed directors as the chairman of the board.
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(6) Every appointed director shall hold office for a period of three years, unless he is earlier removed from office or vacates his office,
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(7) If any appointed director is temporarily unable to discharge the duties of his office on account of ill health, or absence from Sri Lanka, or any other cause, the Minister may appoint some other person to act as a director in his place.
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(8) If the ex officio director is unable to attend any meeting of the board, he may authorize any other officer to be present on his behalf at such meeting; and the officer so authorized shall be deemed for the purpose of such meeting to be a member of the board.
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(9) An appointed director may resign his office by letter addressed to the Minister.
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(10) The Minister may, if he thinks it expedient to do so, remove an appointed director from office.
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(11) A director who vacates office by resignation or effluxion of time shall be eligible for reappointment.
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(12) The ex officio director shall have all the same rights and privileges as the appointed directors.
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(13) The provisions of subsections (1), (2) and (3) shall be deemed to have come into operation on October 12, 1961.
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7.
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(1) The authorized capital of the bank shall be fifty billion rupees divided into fifty million shares of one-thousand rupees each.
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(2) The paid-up capital of the bank shall be such amount as may be determined from time to time by the Minister by Order published in the Gazette.
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(3) The liability of the Government at any time as sole shareholder shall be limited to the total amount of the capital represented by the shares held for the time being by the Government.
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8.
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(1) The board shall, out of the profits available for payment of dividend and before any dividend is declared, set aside a sum equivalent to twenty per centum of such profits to the credit of a fund called the permanent reserve fund of the bank until such permanent reserve fund is equivalent to one-half of the paid-up capital of the bank for the time being; and in the event that at any time thereafter the amount of such permanent reserve fund is less than one-half of the paid-up capital of the bank for the time being, the board shall as soon as practicable carry to that fund such further sum or sums out of the profits available for dividend as may be necessary until the amount of the permanent reserve fund is equivalent to one-half of the paid-up capital of the bank for the time being. The board may from time to time in its discretion carry to the permanent reserve fund out of profits such further sums as it may deem fit, in addition to the sums required by the preceding provisions of this subsection to be carried thereto.
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(2) The permanent reserve fund shall be shown separately in the balance sheet of the bank.
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9.
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(1) In addition to the permanent reserve fund the board shall create a fund called the contingency fund of the bank and shall carry to that fund such sums out of the profits of the bank as the board thinks proper.
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(2) The contingency fund may be applied from time to time in such manner as the board shall determine-
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(a) for meeting depreciation and losses;
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(b) for equalizing dividends;
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(c) for repairing, improving or maintaining any of the property of the bank;
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(d) for any other purposes which the board may think proper.
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(3) The board may divide the contingency fund into such special funds as it thinks fit, and may consolidate into one fund any special funds or any parts of any special funds into which the contingency fund may have been divided as it thinks fit, with full power to employ the whole or any part of the assets constituting the contingency fund in the business of the bank without being under any obligation to keep the same separate from other assets of the bank. The board may also, (subject to the provisions of this Ordinance), without placing the same to reserve, carry over any profits which it may think it is not prudent to divide.
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(4) It shall not be necessary to show the contingency fund separately in the balance sheet of the bank.
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10.
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(1) The Minister in charge of the subject of Finance shall guarantee the repayment of any sum due to the bank on any loan, overdraft, advance or other accommodation granted by the bank with the approval of such Minister under clause 3 (a) of Part II in the First Schedule hereto.
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(2) Any sum required for the fulfillment of a guarantee provided under subsection (1) may, with the approval of Parliament, be paid out of the Consolidated Fund.
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(3) Immediately after a guarantee is given under subsection (1), the Minister in charge of the subject of Finance shall lay a statement of the guarantee before the Cabinet of Ministers.
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(4) Where any sum is paid out of the Consolidated Fund in fulfillment of a guarantee provided under subsection (1), the Minister in charge of the subject of Finance shall forthwith lay before Parliament a statement that such sum has been paid.
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Disclosure of interest by a director.
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11. A director who or whose spouse or dependent child or a firm or company in which such director, his spouse or dependent child has a substantial interest is directly or indirectly interested in any business transacted or proposed to be transacted by the bank shall disclose the nature of such interest at the meeting of the board where such business is discussed. The disclosure shall be recorded in the minutes of the board and such director shall not take part in any deliberation or decision of the board with regard to that business and shall withdraw from such meeting whilst such deliberation is in progress or decision is being made.
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Director to disclose any obligation to other banks and lending institutions.
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12. A director for the time being of the bank who incurs an obligation or debt to any other bank or to a lending institution shall, within one month of the date on which such obligation or debt was incurred, disclose to the bank the particulars relating to such obligation or debt.
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Provisions relating to applications for loans, & c, and their disposal.
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13.
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(1) Every application for any loan, overdraft, advance or other accommodation shall be made to the general manager or an officer nominated by him for the purpose.
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(2) Every application made under subsection (1) which requires the approval of the board shall be submitted to the board together with the written observations of the general manager on such application.
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(3) The manner in which every application made under subsection (1), which does not require the approval of the board is disposed of by the general manager or other officer under the powers delegated by the board shall be reported to the board.
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Nominations by persons having a deposit or savings account.
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14.
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(1) Any person over sixteen years of age who has a deposit or savings account may nominate a person, (hereinafter called a ” nominee “), to whom the moneys lying to the credit of such first-mentioned person (hereinafter called a nominator “) shall be of paid upon his death and, if his death should occur while the account exists, the moneys shall be so paid subject to the provisions of this Ordinance.
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(2) A nomination made under subsection (1) shall have effect upon the death of the nominator notwithstanding anything in his last will to the contrary.
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(3) Any nomination made under subsection (1) shall be deemed to be revoked by the death of the nominee in the lifetime of the nominator or by written notice of revocation signed by the nominator in the presence of a witness (who shall attest the signature of the nominator) or by any subsequent nomination made by the nominator.
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(4) The moneys lying in his deposit or savings account to the credit of the person who has made a nomination under subsection (1) shall, in the event of his death, be deemed not to form part of the estate or property of that person for the purpose of probate or administration proceedings under the Civil Procedure Code, and the transfer of such property shall not be an offence under section 547 of that Code.
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(5) Upon the death of any person who has a savings account, and who has made a nomination under subsection (1), the bank shall communicate in writing by registered post with the Commissioner-General of Inland Revenue informing him of the name and address of such person, the fact of his death, the name and address of the nominee and the amount of the moneys lying to the credit of the nominator at the time of his death, and inquiring whether any, and if so what, sum of money should be withheld against payment of estate duty in respect of such moneys.
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(6) If the Commissioner-General of Inland Revenue informs the bank, in reply to the communication made under subsection (5), what sum of money should be withheld, the bank may withhold that sum and pay it to the Commissioner- General of Inland Revenue.
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(7) If no reply, specifying what sum of money should be withheld, is received by the bank from the Commissioner-General of Inland Revenue to the communication made under subsection (5) within one month of the date of posting or handing over that communication, the bank may take action as if no sum of money need be withheld.
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(8) No payment shall be made by the bank to any nominee unless the nominee-
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(a) submits an affidavit stating that he is the nominee; and
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(b) produces a certificate as to his identity from a person acceptable to the bank.
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(9) A payment made subject to the deduction, if any, made under subsection (6) and the conditions set out in subsection (8), to any nominee of a nominator who has died shall be a complete discharge of the obligations of the bank in respect of the moneys lying to the credit of such nominator.
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(10) Where, upon the death of any person who has a deposit or savings account, other than a nominator, there is a sum of money to the credit of such person in the bank, any officer or person who is duly authorized to make payments in respect of accounts may, if satisfied that such first-mentioned person died intestate and that letters of administration to the estate of such person are not required by any written law, pay such sums of money, subject to the provisions of this Ordinance, to the person or persons to whom such sum is required, in accordance with any rule in that behalf, to be paid:
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Provided that until rules are made in that behalf, any such sum may be paid to the person or persons legally entitled to the payment thereof.
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15. Where default is made in the payment of any sum due on any loan, overdraft, advance or other accommodation granted on the mortgage of movable or immovable property, whether that sum is due on account of principal or interest or both, default shall be deemed to have been made in respect of the whole of the unpaid portion of that loan, overdraft, advance or other accommodation and the interest due thereon up to date.
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Action by board where default is made.
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16. Where under the provisions of this Ordinance, default is made or deemed to have been made in respect of the whole of the unpaid portion of any loan, overdraft, advance or other accommodation and the interest due thereon, the board may, in its discretion, take action as specified in section 17 or in section 17A or in section 19
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Provided that where the board has in any case taken action, or commenced to take action, in accordance with section 17 or section 17A, nothing shall be deemed to prevent the board at any time from subsequently taking action in that case by resolution under section 19 if the board deems it necessary or advisable to do so.
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Authorization of manager to take possession of immovable property.
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17. Subject to the provisions of section 20 the Board may by resolution to be recorded in writing authorize any person specified in the resolution to enter upon and take possession of immovable any property mortgaged to the bank as security for any loan, overdraft, advance or other accommodation in respect of which default has been made and to manage and maintain such property and to exercise the same powers in the control and management of such property as might have been exercised by the mortgagor, if he had not made default.
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Authorization of person to seize movable property.
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17A. Subject to the provisions of section 20. the Board may by resolution to be recorded in writing authorize any person specified in the resolution to seize any movable property mortgaged to the bank as security for any loan. overdraft, advance or other accommodation in respect of which default has been made.
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Procedure where manager is appointed.
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18.
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(1) Any person authorized by resolution of the board under section 17 in respect of any property shall be entitled generally to take action in terms of the resolution and in particular-
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(a) to sell the produce of such property;
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(b) to receive the rents, profits or other income from such property;
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(c) to pay the expenses incurred in the control and management of such property out of the income from such property;
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(d) to appropriate to himself out of such income such sum (if any) as the board may deem fit to fix as remuneration for his services;
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(e) to remain in possession of such property until all moneys due to the bank under the mortgage on such property have been fully paid or until he is directed by the board to yield possession of such property under subsection (2).
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(2) Every person authorized by resolution of the board under section 17 in respect of any property shall-
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(a) pay monthly, out of the income of such property such sum (if any) as the board may in its discretion fix, to the mortgagor for his maintenance;
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(b) pay quarterly or as otherwise directed by the board to such person or persons and in such manner as the board may direct the balance of the income from such property remaining after the payments hereinbefore authorized have been made;
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(c) keep and render to the board at such intervals as the board may determine, clear and accurate records of all sums received or paid out by him in respect of such property;
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(d) yield possession of such property to the mortgagor or some other person as directed by the board and pay to the board any balance of the income from such property remaining in his hands after the payments hereinbefore authorized have been made.
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(3) The board shall when all sums due to the bank under the mortgage have been fully paid surrender possession of the mortgaged property to the mortgagor and return to him any balance remaining of the income from such property.
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Authorization of sale of mortgaged property.
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19. Subject to the provisions of section 20 the board may by resolution to be recorded in writing authorize any person specified in the resolution to sell by public auction any movable or immovable of property mortgaged to the bank as security for any loan, overdraft, advance or other accommodation in respect of which default has been made in order to recover the whole of the unpaid portion of such loan, overdraft, advance or other accommodation, and the interest due thereon up to the date of the sale, together with the moneys and costs recoverable under section 26 and thereafter it shall not be competent for the borrower or any person claiming through or under any disposition whatsoever of the right, title or interest of the borrower to and in the property made or registered subsequent to the date of the mortgage to the bank, in any court to move to invalidate the said resolution or the subsequent sale for any cause whatsoever, and no court shall entertain any such application.
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20.
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(1) Save as otherwise provided in subsection (2), the provisions of sections 17 , 17A and 19 shall apply in the case of any default notwithstanding that the borrower may have died or that any right, title or interest whatsoever in the property mortgaged as security for the loan, overdraft, advance or other accommodation may have passed by voluntary conveyance or by operation of law to any other person.
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(2)
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(a) Where-
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(i) the borrower is dead ;
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(‘ii) bank has been notified, in writing of his death within a period of three months of his death ; and
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(iii) probate of his will or letters of administration to his estate have not been issued. the District Court of Colombo or the District Court of the district in which that property is situate or kept may,
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upon application made in that behalf by the bank and after service of notice of the application on such persons, if any, as the court may order, and if satisfied that the grant of probate or the issue of the letters of administration is likely to be unduly delayed, appoint a person to represent the estate of the borrower for the purposes of this section.
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(b) Where the borrower is dead and the bank has been notified in writing of his death within a period of three months of his death, the board shall not take action as specified in section 17 or section 17A or section 19 unless and until a representative of his estate has been appointed under this section.
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Notice of resolution of Board to sell mortgaged property.
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21. Notice of every resolution under section 19 authorizing the sale of any property shall be published, in addition to the Gazette, in three daily newspapers in Sinhala, Tamil and English respectively and copies of such notice shall be sent to the borrower by registered post to the address furnished by him to the bank.
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22. Notice of the date, time and place of every sale shall, not less than fourteen days before the date fixed for the sale, be published in the Gazette and copies of such notice shall-
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(a) be sent to the borrower by registered post to the address furnished by him to the bank
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(b) where immovable property is to be sold, be posted on or near such property; and
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(c) be affixed to the walls of the kachcheri and the several District Courts, Magistrates’ Courts and Primary Courts within the jurisdiction of which the property is situate or kept.
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23.
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(1) If the amount of the whole of the unpaid portion of the loan, overdraft, advance or other accommodation (together with all interest due thereon according to the terms of the mortgage), and of the moneys and costs, if any, recoverable by the board under section 26 is tendered to the board at any time before the date fixed for the sale, the property shall not be sold and no further steps shall be taken in pursuance of the resolution under section 19 for the sale of that property.
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(2) If the amount of the installment or other payment in respect of which default has been made, together with any interest due thereon according to the terms of the mortgage, and of the moneys and costs, if any, recoverable by the board under section 26, is tendered to the board at any time before the date fixed for the sale, the board may, in its discretion, direct that the property shall not be sold, and that no further steps shall be taken in pursuance of the resolution under section 19 for the sale of that property.
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24. The board may fix an upset price below which the property shall not be sold to any person other than the Bank.
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Default in respect of one of several loans on same property.
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25. In any case where more than one loan, overdraft, advance or other accommodation has been granted by the bank on the security of the same property and default is made in the payment of any sum due upon any one or more of such loans, overdrafts, advances or other accommodation, the foregoing provisions of this Ordinance shall apply notwithstanding that default may not have been made in respect of any of the other loans, overdrafts, advances or other accommodation, and the board may, in any such case, by resolution under section 19 authorize the sale of the property for the recovery of the total amount due to the bank in respect of all such loans, overdrafts, advances and other accommodation, as the case may be, and the provisions of this Ordinance shall apply accordingly.
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Recovery of expenses and costs incurred by the bank
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26. In addition to the amount due on any loan, overdraft, advance or other accommodation, the board may recover from the borrower, or any person acting on his behalf-
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(a) all moneys expended by the bank in accordance with the covenants contained in the mortgage bond executed by the person to whom the loan, overdraft, advance, or other accommodation was made or in the payment of premiums and other charges in respect of any policy of insurance effected on the property mortgaged to the bank, and in the payment of all other costs and charges authorized to be incurred by the bank, under the covenants contained in such mortgage bond; and
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(b) the costs of advertising the sale and of selling the mortgaged property: Provided that the costs incurred under this paragraph shall not exceed such percentage of the loan, overdraft, advance or other accommodation as may from time to time be fixed by resolution of the board.
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Payment of excess balance.
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27. If the mortgaged property is sold, the board shall, after deducting from the proceeds of the sale the amount due on the mortgage and the money and costs recoverable under section 26, pay the balance remaining, if any, either to the borrower or any person legally entitled to accept the payments due to the borrower, or where the board is in doubt as to whom the money should be paid, into the District Court of the district in which the mortgaged property is situate or kept:
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property is situate or kept:
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Provided however that where the borrower has made default in respect of any other loan, overdraft, advance or accommodation granted to him by the bank, the board shall. in lieu of paying of such balance to the borrower or any person legally entitled to accept the payments due to the borrower or depositing in court, as aforesaid, deposit such balance in the District Court of the district in which the property mortgaged as security for such other loan, overdraft, advance or accommodation is kept or situate.
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28.
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(1) If the mortgaged property is sold, the board shall sign a certificate of sale and thereupon all the right, title and interest of the borrower to and in the property shall vest in the purchaser; and thereafter it shall not be competent for any person claiming through or under any disposition whatsoever of the right, title or interest of the borrower to and in the property, made or registered after the date of the mortgage of the property to the bank, in any court to move to invalidate the sale for any cause whatsoever or to maintain any right, title or interest to or in the property as against the purchaser.
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(2) A certificate signed by the board under subsection (1) shall be conclusive proof, with respect to the sale of any property, that all the provisions of this Ordinance relating to the sale of that property have been complied with.
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(3) If the purchaser is some person other than the bank, the certificate shall be substantially in Form A in the Third Schedule hereto and, if the purchaser is the bank the certificate shall be substantially in Form B in that Schedule.
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(4) Every certificate of sale shall be liable to stamp duty and charges as if it were a conveyance of property and to any registration and other charges authorized by law, all of which shall be payable by the purchaser.
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Order for delivery of possession.
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29.
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(1) The purchaser of any immovable property sold in pursuance of the preceding provisions of this Ordinance shall, upon application made to the District Court of Colombo or the District Court having jurisdiction over the place where that property is situate, and upon production of the certificate of sale issued in respect of that property under section 28, be entitled to obtain an order for delivery of possession of that property.
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(2) Every application under subsection (1), shall be made, and shall be disposed of, by way of summary procedure in accordance with the provisions of Chapter XXIV of the Civil Procedure Code; and on all documents filed for the purpose of each such application and on all proceedings held thereupon, stamp duties and other charges shall be payable at the respective rates payable under any written law for the time being in force, on application for, and proceedings connected with or incidental to, the execution of a decree of a District Court for the delivery of possession of any immovable property of the same value as the land to which such application relates.
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(3) Where any immovable property sold in pursuance of the preceding provisions of this Ordinance is in the occupancy of the debtor or of some person on his behalf or of some person claiming under a title created by the debtor subsequently to the mortgage of the property to the bank, the District Court shall order delivery to be made by putting the purchaser, or any person whom he may appoint to receive possession on his behalf, in possession of the property.
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(4) Where any immovable property sold in pursuance of the preceding provisions of this Ordinance is in the occupancy of a tenant or other person entitled to occupy the same, the District Court shall order delivery to be made by affixing a notice that the sale has taken place, in the Sinhala, Tamil and English languages, in some conspicuous place on the property, and proclaiming to the occupant by beat of tom, or in such other mode as may be customary, at some convenient place, that the interest of the debtor has been transferred to the purchaser. The cost of such proclamation shall be fixed by the court and shall in every case be prepaid by the purchaser.
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(5) Every order under subsection (3) or subsection (4) shall be deemed, as the case may be, to be an order for delivery of possession made under section 287 or 288 of the Civil Procedure Code, and be enforced in like manner as an order so made, the debtor and the purchaser being deemed, for the purpose of the application of any provision of that Code, to be the judgment- debtor and Judgment-creditor, respectively.
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30.
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(1) Where the property sold has been purchased on behalf of the bank, the board may, at any time before it resells that property, cancel the sale by an endorsement to that effect on a certified copy of the certificate of sale, upon the debtor or any person on his behalf paying the amount due in respect of the loan, overdraft, advance or other accommodation, for which the property was sold (including the costs of seizure and sale) and interest on the aggregate sum at a rate not exceeding the prescribed rate.
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(2) An endorsement made under this section shall-
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(a) in the case of movable property, immediately on the endorsement being made, and
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(b) in the case of immovable property, upon registration in the office of the Registrar of Lands, have the effect of revesting the property in the debtor as though the sale under this Ordinance had not taken place.
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31.
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(1) If the property sold has been purchased on behalf of the bank, and the sale is not cancelled under section 30, the board may, at any time, resell the property and transfer to the purchaser by endorsement on a certified copy of the certificate referred to in subsection (3) of section 28, all the right, title and interest which would have been acquired by the purchaser at the original sale.
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(2) An endorsement made under this section shall be liable to the same stamp duty and charges as a certificate to a purchaser at the original sale and shall-
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(a) in the case of movable property, immediately on the endorsement being made, and
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(b) in the case of immovable property, upon registration in the office of the Registrar of Lands, have the effect of vesting the property in the purchaser as though the sale under this Ordinance had not taken place.
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Board not precluded from other methods of recovery.
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32. Nothing in sections 16 to 31 shall be deemed to preclude the board from recovering the amount due on any mortgage bond in accordance with the provisions of any other written law.
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Minister to give directions.
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33. The Minister may from time to time give general or special directions in writing to the Board as to the performance of the duties and the exercise of the powers of the bank and it shall be the duty of the Board to comply with such directions.
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Contracts.
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41.
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(1) Contracts on behalf of the bank may be made as follows:-
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(a) a contract which if made between private persons would be by law required to be in writing, may be made on behalf of the bank in writing under the common seal of the bank;
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(b) a contract which if made between private persons is by law required to be in writing, signed by the parties to be charged therewith, may be made on behalf of the bank in writing signed by any person or persons duly authorized thereto as hereinafter provided; and
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(c) a contract which if made between private persons would by law be valid although made by parol only and not reduced into writing, may be made by parol on behalf of the bank by any person or persons duly authorized thereto as hereinafter provided.
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(2) A contract made according to this section shall be effectual in law and shall bind the bank and all other parties thereto and their legal representatives.
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(3) A contract made according to this section may be varied or discharged in the same manner in which it is authorized by this section to be made.(*Sections 34 to 40 (both inclusive) are repealed by Law No. 10 of 1974.)
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Bills of exchange and promissory notes.
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42. A bill of exchange or promissory note shall be deemed to have been made, executed, or endorsed on behalf of the promissory bank, if made, executed, or endorsed in the name of, or by or on behalf or on account of the bank by any person or persons duly authorized thereto as hereinafter provided.
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Persons authorized to act on behalf of the bank.
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43. No person other than the directors and persons thereunto expressly authorized by the board and acting within the limits of the authority so conferred on them shall have any authority to make, draw, accept or endorse any promissory note, bill of exchange, cheque or order for the payment of money in the name or on behalf of the bank or to enter into any contract so as to impose thereby any liability on the bank or otherwise to pledge the credit of the bank.
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Execution of deeds abroad.
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44.
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(1) The bank may, by writing under its common seal, empower any person either generally or in respect of any specific matter, as its attorney, to execute deeds on its behalf in any place not situate in Sri Lanka.
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(2) A deed signed by such an attorney on behalf of the bank and under his signature or seal shall bind the bank and have the same effect as if it were under its common seal.
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56.
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(1) The board shall have power to appoint the staff of the bank including the subordinate staff:
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Provided that the appointment of the general manager shall not be made without the previous approval in writing of the Minister;
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Provided, further, that the Minister’s approval shall not be necessary for the appointment of an officer of the bank to act for the general manager during his absence if such appointment is for a period not exceeding four months.
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(2) The board may, with the approval of the Minister, from time to time alter or revise the salaries, emoluments, travelling allowances, provident fund and pension rights of any officer or member of the subordinate staff of the bank.(*Sections 45 to 55 (both inclusive) are repealed by Law No. 10 of 1974.)
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Officers to furnish security.
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57.
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(1) Every officer and member of the subordinate staff of the bank shall give security to the satisfaction of the board for the due and faithful performance of his duties.
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(2) The expression “subordinate staff” for the purpose of section 56 and of subsection (1) shall include only such officers as are by the board deemed to be members of the subordinate staff.
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Dismissal of general manager.
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58. No general manager of the bank shall be dismissed except-
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(a) on a resolution of the board passed by a majority of two-thirds of the directors for the time being holding office; and
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(b) with the written approval of the Minister.
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No liability for damage or loss caused otherwise than by misconduct or willful or default.
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59. No director or officer of the bank shall be liable for any damage or loss suffered by the bank unless such damage or loss was caused by his misconduct or willful default.
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Reimbursement for incurred on behalf of the bank.
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60. Every director, manager, secretary or other officer of the bank shall be indemnified by the bank from all losses and expenses incurred by him in or about the discharge of his duties, other than such losses and expenses as the board may deem to have been occasioned by his misconduct or willful default.
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61. Every director, manager, auditor. officer, servant, agent, accountant, or other person employed in the business of the bank, shall, before entering upon his duties sign a declaration pledging himself to observe strict secrecy respecting all transactions of the bank, its customers, and the state of accounts with any person and all matters relating thereto and shall by such declaration pledge himself not to reveal any other matters which may come to his knowledge in the discharge of his duties except-
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(a) when required to do so-
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(ii) by a court of law, or
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(iii) by the person to whom such matters relate;
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(b) in the performance of his duties; and
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(c) in order to comply with any of the provisions of this Ordinance or any other law. Declarations of secrecy made before 24th March, 1952. Every declaration made under this section before the 24th day of March, 1952, shall, for all purposes, have effect and be deemed to have had effect as though the reference in such declaration to ” accounts with individuals ” were a reference to ” accounts with any person “.
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Right to refuse to answer questions.
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62. Every director, auditor, manager, secretary, or other officer of the bank shall, except when required to do so by a court or by any law, decline to answer any question concerning the business of the bank which may be put to him on any occasion whatsoever, if he considers that the answer to such question would disclose or tend to disclose the secrets of the bank or the business or affairs of any customer of the bank.
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Receipts when valid.
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63. A receipt signed by two directors or by any person expressly authorized by the board to give receipts shall be an effectual discharge for moneys paid to the bank.
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64. No person, unless he is a director, auditor, officer, accountant or clerk of the bank or other person whose duties require him to do so, shall be entitled to inspect any of the books, accounts, documents or writings of the bank, except where he is authorized to do so under any written law.
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Application of the provisions of the Public Corporations (Financial Control) Act.
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65. The provisions of the Public Corporations (Financial Control) Act shall mutatis mutandis, apply to the financial control and accounts of the bank.
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Money Lending Ordinance and Debt Conciliation Ordinance not to apply to debts due to the bank.
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68. Nothing in the Money Lending Ordinance or the Debt Conciliation Ordinance shall apply or be deemed to apply to any debt due to the bank, or to prejudice or affect the rights of the bank in respect of the recovery of any such debt.(* Sections 66 and 67 are repealed by Law No. 10 of 1974. Repealed and replaced by the Companies Act, No. 17 of 1982.)
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Pawnbrokers Ordinance not to apply to debts due to the bank.
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69. The Pawnbrokers Ordinance shall not apply to the bank where the bank carries on the business of a pawnbroker.
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Bank may possess rubber in excess of quantity prescribed by Rubber Control Act.
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69A. Notwithstanding the provisions of section 10 of the Rubber Control Act the bank may lawfully possess a quantity of rubber in excess of the quantity prescribed under that Act.
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Bank may possess tea in excess of quantity prescribed by Tea Control Act.
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69B. Notwithstanding the provisions of section 15 of the Tea Control Act the bank may lawfully possess a quantity of made tea in excess of the quantity prescribed under that Act.
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Bank may possess excise articles in excess of quantity declared to be limit of sale by retail.
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69C. Notwithstanding the provisions of section 17 of the Excise Ordinance the bank may lawfully possess a quantity of any excisable article in excess of the quantity declared under section 4 of that Ordinance to be the limit of sale by retail.
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Tea and Rubber Estates (Control of Fragmentation) Act not to apply to transfer of property authorized to be sold under section 19.
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69D. The provisions of the Tea and Rubber Estates (Control of Fragmentation) Act shall not apply to the transfer of ownership by the bank of any immovable property the sale of which is authorized by the board under section 19 of this Ordinance.
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Application of the Provision of the companies Ordinance.
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70.
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(1) The provisions of the Companies Ordinance! or any other enactment regulating the incorporation of companies shall not apply to the bank.
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(2) Notwithstanding the provisions of subsection (I) the Minister may, whenever it shall seem to him expedient to do so, by Order declare that any one or more or all the provisions of the said Ordinance or any other enactment relating to companies for the time being in force shall apply to the bank and such provision or provisions shall thereupon have effect as if such provision or provisions are part of this Ordinance.
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Business which the bank transact.
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71. Subject to the provisions of this Ordinance the business which the bank is authorized to carry on and transact shall be the several kinds of business specified in Part I of the First Schedule subject to the limitations mentioned in Part II thereof.
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By-taws of the bank.
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72. The provisions contained in the Second Schedule shall be the by-laws of the bank in regard to the matters to which they relate.
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Applications to the Minister.
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74. All applications to the Minister by the board for his approval or sanction for any matter or thing for which the Minister’s approval or sanction is by this Ordinance required, shall be made in writing signed by the officer or person authorized in that behalf by the board.
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Interpretation.
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76. In this Ordinance (including the Schedules), unless the context otherwise requires-
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” approved society means a society approved for the purposes of this Ordinance by the Minister by Order published in the Gazette;
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“bank” means the Bank of Ceylon established by this Ordinance;
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” board” means a duly convened and constituted meeting of the directors of the bank for the time being;
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” capital” means the capital for the time being of the bank ;
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” central office ” means the central office of the bank;
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” director ” means a person holding the office of a director of the bank;
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” mortgage ” includes any charge on property for securing money or money’s worth;
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” officer ” means an employee of the bank and shall not be construed to, include a director or an auditor of the bank;
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” Secretary to the Treasury ” means the person for the time being performing the functions of the Secretary to the Treasury of the Government;
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” substantial interest”-
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(a) in relation to a company, means the holding of a beneficial interest by an individual or his spouse or minor child, whether singly or taken together, in the shares thereof, the amount paid up of which exceeds five hundred thousand rupees or five per centum of the paid-up capital of the company, whichever is less ; and
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(b) in relation to a firm, means the beneficial interest held therein by an individual or his spouse or minor child, whether singly or taken together, which represents more than five per centum of the total capital subscribed by all the partners of the said firm.
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Schedules
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