NATIONAL DEVELOPMENT BANK OF SRI LANKA

(1) The purposes of the Bank shall be to promote the industrial, agricultural, commercial and other development of the economy of Sri Lanka having regard inter alia to the development of the rural sector, in accordance with the provisions of this Act-

(2) In carrying out its purposes, the Bank shall whenever it is feasible and desirable act in participation or cooperation with approved credit institutions.

(a) to grant loans and advances to any enterprises engaged or about to engage in industry, agriculture or commerce;

(b) to guarantee loans raised or to be raised by industrial, agricultural and commercial enterprises from approved credit institutions;

(c) to guarantee obligations of financial institutions arising out of the underwriting of capital issues of industrial, agricultural and commercial enterprises;

(d) to participate in the equity of industrial, agricultural and commercial enterprises, and to subscribe to, or to purchase or underwrite, the issue of stocks, shares, bonds or debentures of any such enterprises, and to sell and deal in such securities;

(e) to grant loans and advances by way of re-finance of any loans or advances granted by approved credit institutions, and other institutions approved by the Bank to industrial, agricultural and commercial enterprises, and for that purpose to fix the minimum and maximum periods of maturity of loans granted by such banks and institutions;

(f) to provide such services as technical and administrative advice and assistance which serves its purposes and comes within its functions to industrial, agricultural and commercial enterprises;

(g) to incur, during the first five years after the commencement of its business, expenditure up to an amount not exceeding two per centum of its paid-up capital in furnishing the services referred to in paragraph (f) on a non reimbursable basis, and thereafter to charge to the funds of the Bank with the expenditure incurred in continuing to provide such services where necessary on a non reimbursable basis;

(h) to establish subsidiary companies to assist it in carrying out its purposes and exercising and performing its powers and duties;

(i) to promote the establishment of industrial, agricultural, commercial and other enterprises;

(j) to acquire or purchase any movable or immovable property, or any industrial, agricultural, commercial or other enterprise, and to manage or arrange for the management of such property or enterprise, and to sell or otherwise dispose of such property or enterprise;

(k) to invest temporarily the funds of the Bank in foreign securities;

(l) to participate in loans, equities, underwriting arrangements and guarantees with approved credit institutions;

(m) subject to such conditions as may be determined by the Board of Directors, to accept, discount, rediscount, buy, sell and deal in bills of exchange, promissory notes, coupons, drafts, debentures, certificates, scrip and other instruments and securities whether transferable or negotiable or not, of industrial, agricultural and commercial enterprises;

(n) to undertake development projects, including pilot projects, in order to achieve the purposes of the Bank;

(o) to engage in the construction of warehouses, godowns, stores and buildings required for agricultural, industrial and commercial activities;

(p) to lease, let on hire, sell outright, or sell on a hire-purchase basis warehouses, godowns, stores and buildings, machinery, equipment and other goods;

(q) to guarantee loans raised by any industrial, agricultural or commercial enterprise, being loans which are floated in the open market;

(r) to guarantee deferred payments due from any industrial, agricultural or commercial enterprise;

(s) to convert a part or whole of its loans to industrial, agricultural or commercial enterprises, and its subscriptions to bonds or debentures issued by any such enterprise into equity capital;

(t) to subscribe to, or to purchase, or to underwrite the issue of, stocks, shares, bonds or debentures of approved credit institutions;

(u) to receive, in consideration of the functions the Bank may be performing, such commission, brokerage, interest, remuneration or fees, as the Board of Directors may, from time to time, determine;

(v) to open deposit accounts in the Central Bank, any commercial bank, or any bank or financial institution outside Sri Lanka;

(w) to accept term deposits from any person in such amounts and for such periods as may be determined by the Board of Directors;

(x) to grant and issue letters of credit and circular notes;

(y) to buy, sell and deal in bullion and specie and engage in operations in exchange; and

(z) generally to do, directly or indirectly, all such acts or things as may be connected with, or are in furtherance of, the exercise, discharge or performance of the powers, functions or duties of the Bank under this Act or any other law.

(a) to appoint a General Manager who shall be the chief executive officer of the Bank;

(b) to appoint such other officers and servants as may be necessary for carrying out the work of the Bank;

(c) to establish “a provident fund, and provide welfare and recreational facilities, houses, hostels and other like accommodation for persons employed by the Bank;

(d) to enter into and perform all such contracts, whether in or outside Sri Lanka, as may be necessary for the exercise of the powers and the performance of the duties of the Bank;

(e) to make rules in relation to its officers and servants, including their appointment, promotion, remuneration, disciplinary control, conduct and the grant of leave to them;

(f) to make rules in respect of the administration of the affairs of the Bank; and

(g) to do all other things which, in the opinion of the Board of Directors, are necessary to facilitate the proper carrying on of the business of the Bank.

(1) The Bank shall have a Board of Directors consisting of-

(2) In this Act, the persons appointed as Directors under paragraphs (b) to (d} (both inclusive) of subsection (1) are referred to as ” appointed Directors” and the persons nominated as Directors under paragraph (e), and in the proviso to paragraph (/) of subsection (1) of this section as ” nominated Directors “.

(3) In the absence of the ex officio Director, the person holding office for the time being as Deputy Secretary to the Treasury shall act as that member’s alternate at Board meetings and have the right to vote thereat.

(4) Where an appointed Director or a nominated Director is by reason of illness or other infirmity or absence from Sri Lanka, temporarily unable to perform the duties of his office, the appointing authority in the case of appointed Directors and the Minister in the case of nominated Directors may appoint or nominate a suitable person to act as his alternate at Board meetings and such person shall have the right to vote thereat.

(5) The Minister may, without assigning any reasons, remove a nominated Director from office. Such removal shall not be called in question in any court.

(6) A nominated Director may resign his office by letter addressed to the Minister.

(7) Subject to the provisions of subsections (6) and (7), the term of office of a nominated Director shall be four years.

(1) The general superintendence, direction and control of the affairs and business of the Bank shall vest in the Board of Directors.

(2) The Board of Directors may exercise, discharge and perform all the powers, functions and duties of the Bank under this Act or any other law and do all acts and things which may be done by the Bank under this Act or any other law.

(3) In the exercise, discharge and performance of its powers, functions and duties, the Board of Directors shall, subject to the provisions of this Act, act in accordance with sound business principles, and shall have due regard to the interest of industry, agriculture and commerce and to the public interest generally.

(1) Meetings of the Board of Directors shall be held at least once in every month and, in addition, as frequently as are necessary for the purpose of discharging its responsibilities under this Act.

(2) At any meeting of the Board of Directors, four Directors shall constitute a quorum.

(3) Subject to the other provisions of this Act, the procedure to be followed in regard to the transaction of business at meetings of the Board of Directors, shall be as determined by rules made by the Board of Directors.

(1) The Board of Directors may delegate to the General Manager or any other employee of the Bank any of its powers and duties.

(2) Every delegate appointed under subsection (1) shall exercise or perform the power or duty delegated to him subject to the general or special directions of the Board of Directors.

(1) The Minister shall appoint a Chairman from amongst the members of the Board of Directors.

(2) The term of office of the Chairman shall, subject to the provisions of subsection (3), be for a period of four years commencing on the date of appointment,

(3) In the event of the vacation of office by the Chairman before the expiration of his term of office, another person shall be appointed in his place to hold office during the unexpired part of the term of office of the Chairman so vacating office.

(4) Any person vacating office as Chairman by effluxion of time shall be eligible for reappointment.

(5) The Minister may, without assigning any reason, remove the Chairman from office. Such removal shall not be called in question in any court.

(6) In the absence of the Chairman, a member chosen by the majority of the members present at any meeting of the Board of Directors shall preside at such meeting.

(7) The Chairman or other member of the Board of Directors who presides at any meeting of the Board shall have in addition to his vote, a casting vote,

(1) The seal of the Bank shall be in the custody of the General Manager.

(2) The seal of the Bank may be altered in such manner as may be determined by the Board of Directors.

(3) The seal of the Bank shall not be affixed to any instrument except in the presence of the General Manager or the acting General Manager and two Directors all of whom shall sign the instrument in token of their presence.

(1) The Board of Directors may appoint agents of the Bank in and outside Sri Lanka.

(2) The Bank may act as agent in and outside Sri Lanka for other institutions.

(1) The Board of Directors may appoint Special Committees consisting of such number of persons as it may deem necessary for the purpose of assisting and advising such Board in the exercise and performance of its powers and duties.

(2) The persons qualified for appointment as members of any Special Committee shall be the members of the Board of Directors, employees of the Bank, and such other persons as the Board of Directors may deem to be qualified for such appointment. The term of office of any such member shall be as determined by such Board.

(1) The following shall, within one year after the appointed date, make an initial contribution of six hundred million rupees to the capital of the Bank in such amounts and in such manner as hereinafter provided and shall by virtue of such contributions be deemed to be shareholders of the Bank:-

(2) The Bank shall, after commencement of business, offer the shares referred to in section 2! to the public for subscription at such time or times, in such amount or amounts and in such manner as may be determined by the Board of Directors, and shall allot such shares.

(3) The Board of Directors may, from time to time, solicit and accept further contributions to the capital of the Bank from any or all of the shareholders.

(4) No contribution to the capital of the Bank shall be made or accepted except in pursuance of the provisions of this section or section 57.

(I) The Bank may, from time to time, borrow sums of money from the Central Bank for periods not exceeding six months, subject to such terms and conditions as to the interest thereon and the repayment thereof as may be determined by the Monetary Board.

(2) Borrowings by the Bank under subsection (1) shall at no time exceed a sum equivalent to ten per centum of the paid-up capital and free reserves of the Bank.

(1) The Board of Directors may create and issue debentures and stock, and the debentures and stock so created and issued shall in this Act be referred to as ” National Development Bank Debentures ” and ” National Development Bank Stock “, respectively.

(2) National Development Bank Debentures and National Development Bank Stock shall be issued, transferred, dealt with, redeemed and cancelled in accordance with such terms and conditions as may be determined by the Board of Directors.

(1) The Government may guarantee the repayment of the principal sum, and the payment of the interest on-

(2) Any sum required for the settlement of any guarantee provided under subsection (1) shall be charged on the Consolidated Fund.

(1) The Government is hereby authorized to guarantee, on such terms and conditions as the Government may determine, any loan raised by the Bank from any international or regional lending institution, or from any other international or foreign organization approved by the Government. Any loan authorized to be guaranteed under this subsection may be denominated in foreign currency.

(2) All sums payable by the Government under any guarantee given under subsection (1) are hereby charged on the Consolidated Fund.

(3) All sums payable by the Bank in respect of principal, interest and other charges on any loan to the Bank from any international or regional lending institution or from any other international or foreign organization approved by the Government, under any guarantee given under subsection (1) shall, notwithstanding anything to the contrary in any written or other law, be paid-

(4) For the purposes of subsection (3), the question whether an individual or a Corporation is or is not resident in Sri Lanka shall be determined in accordance with the provisions of section 67 of the Inland Revenue Act (No. 28 of 1979).

(5) Every guarantee agreement between the Government and any international or regional lending institution, or any other international or foreign organization approved by the Government pursuant to this Act and every guarantee given by the Government pursuant to any such guarantee agreement shall, notwithstanding anything to the contrary in any law, be valid and enforceable in accordance with their respective terms.

(6) In the case of any loan made to the Bank, by any international or regional institution or any other international or foreign organization approved by the Government, and guaranteed by the Government, the Government shall bear any loss, and be entitled to any profit, resulting from any revaluation of the Sri Lanka rupee in relation to the currency or currencies in which that loan is expressed or repayable in whole or in part. The amount of every such loss is hereby charged on the Consolidated Fund.

(7) Notwithstanding anything in any other written law, no agreement, bond or other document executed by the Bank in respect of any loan which may be raised by the Bank from any international or regional lending institution, or from any other international or foreign organization approved by the Government, shall be subject to, or be charged with, any stamp duty or duties whatsoever.

(I) The Bank shall establish a fund which shall be known as the ” Administered Resources Fund “, in this Act referred to as ” the Fund ” The Fund shall not form part of the general funds of the Bank, but shall be a special fund which shall be administered by the Bank separately from the general funds of the Bank for and on behalf of the Government, or of any such foreign Government, foreign or international organization or person or persons as may be approved by the Government.

(2) The purposes of the Fund shall be to enable loans, advances, or other accommodation or grants to be made or given, under and in accordance with the provisions of this Act, from the Fund to industrial, agricultural, commercial or Other enterprises.

(3) The Bank, in terms of any agreement entered into between the donor and the Bank, is hereby authorized to make or give from the Fund any loan, advance, grant, or other accommodation to any industrial, agricultural, commercial or other enterprise.

(4) There shall be credited to the Fund by the Bank the amount of all donations and grants made, for the purposes of the Fund, by the Government, any foreign Government and any other source, whether in or outside Sri Lanka. In addition the Fund shall be credited with the net income or interest arising from the operations of the Fund.

(5) All financial commitments or liabilities of the Bank arising from, or incurred in connexion with, any act or thing done by the Bank with the object of carrying out the purposes of the Fund shall be charged on the Fund.

(6) The Board of Directors may invest temporarily the excess resources of the Fund which cannot be utilized immediately in pursuance of the objectives of the Fund in such securities as it may deem appropriate, without prejudice to the long term interests of the Fund.

(7) Rules may be made under this Act in respect of all or any of the following matters:-

(8) Notwithstanding anything in any other written law, the Bank shall be exempt from the payment of income tax upon the profits and income of the Fund,

(1) All sums of money received by the Bank or the Board of Directors-

(2) All financial commitments or liabilities of the Bank or the Board of Directors arising from, or incurred in connexion with-

(a) the establishment and maintenance of a General Reserve;

(b) the establishment and maintenance of a special reserve for bad or doubtful debts;

(c) the establishment and maintenance of such other reserve funds as may be necessary for specific purposes; and

(d) the payment of dividends.

(1) Every person-

(2) Any notice which is required to be served on any person to whom subsection (1) applies shall be deemed to have been duly served on that person if it is sent by post in a registered letter directed to that person at the address registered by him under that subsection, and service shall be deemed to have been effected at the time at which the letter would be delivered in the ordinary course of post:

Provided that, where any such person fails to register his address under subsection (1), the Bank shall publish, in the Gazette and in at least three daily newspapers in the Sinhala, Tamil and English languages, a notice addressed to him, and such notice shall be deemed to be duly given to him on the day on which such notice is last published.

(a) a mortgage of any movable or immovable property;

(b) any stocks, bonds, debentures, shares, assignments of mortgages or other securities, other than National Development Bank Debentures and National Development Bank Stock;

(c) any warehouse receipts, bills of lading, or such other instruments as may be approved, from time to time, by the Board of Directors for the purpose of such security;

(d) any goods, wares or merchandise; or

(e) any guarantee given by any enterprise or individual and accepted by the Board or Directors.

(1) Where under the provisions of this Act, default is made or is deemed to have been made in respect of the whole of the unpaid portion of any loan and the interest due thereon, the Board of Directors may, in its discretion, take action as specified either in section 39 or in section 41:

Provided that where the Board has in any case taken action, or commenced to take action, in accordance with section 39, nothing shall be deemed to prevent the Board at any time from subsequently taking action in that case by resolution under section 41 if the Board deems it necessary or advisable to do so.

(2) For the purposes of this section and sections 39 to 53, the term ” loan ” means a loan or an advance or any other accommodation granted by the Bank.

(1) Any person authorized by resolution of the Board of Directors under section 39 in respect of any property shall be entitled generally to take action in terms of the resolution and in particular-

(2) Every person authorized by resolution of the Board of Directors under section 39 in respect of any property shall-

(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.

(1) Save as otherwise provided in subsection (2), the provisions of sections 39 and 41 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 may have passed by voluntary conveyance or by operation of law to any other person.

(2) Where the borrower is dead and probate of his will or letters of administration to his estate have not been issued, the District Court of Colombo or the District Court having jurisdiction over the place where that property is situate may, upon application made in that behalf by the Board of Directors 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 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 ; and the provisions of sections 39 and 41 shall not apply in the case of any default made by the borrower unless and until a representative of his estate is appointed under this section.

(a) served on the borrower, if he is alive and on every person on whom notice of any resolution is required to be served under section 43 ;

(b) posted on or near the property which is to be sold ; and

(c) affixed to the walls of the Kachcheri and the several District Courts, Magistrate’s Courts and Primary Courts within the jurisdiction of which the property is situate.

(1) If the amount of the whole of the unpaid portion of the loan (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 of Directors under section 48 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 41 for the sale of that property.

(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 of Directors under section 48, 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 41 for the sale of that property.

(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 was made, in the payment of premia 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

(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 as may from time to time be fixed by resolution of the Board.

(1) If the mortgaged property is sold, the General Manager on a specific authorization by the Board of Directors, shall issue 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.

(2) A certificate signed by the General Manager under subsection (1) shall be conclusive proof, with respect to the sale of any property, that all the provisions of this Act relating to the sale of that property have been complied with.

(3) If the purchaser is some person other than the Bank, the certificate shall be substantially in the Form A in the Schedule to this Act; if the purchaser is the Bank, the certificate shall be substantially in the Form B in the Schedule to this Act.

(4) Every certificate of sale shall be liable to stamp duty and charges as if it were a conveyance of immovable property and to any registration and other charges authorized by law, all of which shall be payable by the purchaser.

(1) The purchaser of any immovable property sold in pursuance of the preceding provisions of this Act shall, possession. 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 50, be entitled to obtain an order for delivery of possession of that property.

(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 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 applications 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.

(3) Where any immovable property sold in pursuance of the preceding provisions of this Act 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.

(4) Where any immovable property sold in pursuance of the preceding provisions of this Act 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-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,

(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 may 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.

(1) The Auditor-General shall audit the accounts of the Bank at such intervals not exceeding a period of twelve months as the Board of Directors may decide.

(2) Notwithstanding the provisions of subsection (1), the Minister may, in consultation with the Auditor-General appoint a qualified auditor or auditors to audit the accounts of the Bank, where such appointment has been made by the Minister, the Auditor-General may, in writing inform such auditor or auditors that he proposes to utilize his or their services for the performance and discharge of the Auditor-General’s duties and functions in relation to the Bank and thereupon such auditor or auditors shall act under the direction and control of the Auditor-General.

(3) Every qualified auditor appointed under the provisions of subsection (2) shall submit his report to the Minister and also submit a copy thereof to the Auditor-General.

(4) The Auditor-General shall examine the accounts of the Bank and ascertain the correctness of the balance sheet and report to the Board of Directors-

(5) For the purpose of ascertaining the correctness of the balance sheet the Auditor- General may, with the sanction of the Board of Directors and the Minister, accept, in respect of any branch of the Bank, any copies or abstracts from the books and accounts of such branch which have been transmitted to the head office of the Bank and which have been certified to be correct by an officer of the Bank authorized in that behalf by the Board of Directors.

(6) In this section “qualified auditor” means-

(1) The Board of Directors shall, on receipt of the Auditor-General’s report in respect of any year, cause a copy of each of the following documents relating to that year to be transmitted to the Minister and to all the shareholders:-

(2) The Minister shall lay copies of the documents transmitted to him under subsection (1) before Parliament.

(I) The Board of Directors is hereby authorized to conclude an Agreement with any international or regional financial institution for participation by such institution in the business of the Bank; and where such Agreement is concluded, such institution shall become a Participant for the purposes of this Act with effect from such date as may be specified in that behalf in the Agreement.

(2) Any Agreement referred to in subsection (1) may contain such covenants and conditions as the Board of Directors may consider necessary, in addition to the provisions required or authorized by this Act to be contained therein.

(3) All rights or powers exercisable under or for the purposes of this Act by a Participant may be exercised on behalf of the Participant by such person or persons, and in such manner, as may be specified in that behalf in the Agreement, and if so exercised, shall be deemed for the purposes of this Act to have been duly exercised by the Participant.

(1) Subject to the provisions Of subsection (3), a Participant shall make an initial contribution to the capital of the Bank of such amount as may be specified in the Agreement referred to in section 57 (1) to which he is a party or, if it is not so specified, as may be determined by the Board of Directors.

(2) Subject to the provisions of subsection (3), where any further amount is contributed by the shareholders to the capital of the Bank, a Participant may make a further contribution to the capital of the Bank of such amount as may be determined by the Board of Directors.

(3) The provisions of subsections (1) and (2) shall be subject to the following limitations and conditions, namely-

(1) A Participant shall, by virtue of his contribution to the capital of the Bank, be a shareholder in the Bank and accordingly certificates for shares, each of a nominal value of one hundred rupees shall be issued by the Bank to the Participant, up to an amount equal to the contribution made by the Participant.

(2) The right of a Participant to transfer or dispose of any shares held by him shall be subject to the provisions contained in that behalf in this Act and in the Agreement concluded under section 57 (1) to which he is a party; and if any such shares are duly transferred to any other person, such shares shall be held by such other person in all respects in like manner and subject to the same provisions (whether contained in this Act or in the Agreement) as though such person were the Participant.

(1) A Participant shall not be entitled to sell, assign, charge or otherwise in any manner whatsoever to alienate or encumber any shares in the Bank, except with the prior consent in writing of the Board of Directors and except to or in favour of a person approved by such Board for the purpose.

(2) If any Agreement concluded under section 57 contains provision specifying the circumstances in which the consent of the Board of Directors to any proposed sale or alienation of the shares of a Participant who is a party to such Agreement shall not be withheld, such provision shall have effect as though it were herein enacted.

(3) No shares of a Participant in the Bank shall, except with the prior consent of the Board of Directors conveyed in writing to the Participant by the General Manager, be or be liable to be sold in execution of any order or decree of any court or by any assignee in insolvency of the Participant, or if the Participant is a company, by any liquidator or otherwise in the course of any proceedings for the winding-up of the company.

(4) Where application is made to the Board of Directors for such prior consent as is required by subsection (1) or subsection (3), the Board may, in lieu of granting such consent, determine that the shares to which the application relates shall be acquired by any of the other shareholders.

(5) The preceding provisions of this section shall have effect notwithstanding anything in any written or other law, and in the event of any conflict or inconsistency between such preceding provisions and anything in any written or other law, such provisions shall prevail.

(a) the Money Lending Ordinance; and

(b) the Debt Conciliation Ordinance.

(a) when required so to do-

(b)in the performance of his duties; and

(c) in order to comply with any of the provisions of this Act.

(1) Contracts on behalf of the Bank may be made as follows:-

(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.

(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.

(1) The Bank may, by writing under its common seal, empower any person generally or in respect of any specific matter, as its attorney, to execute deeds on its behalf in any place outside Sri Lanka.

(2) A deed signed by such 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.

(a) any matter required by this Act to be prescribed;

(b) any matter for which rules are required or authorized to be made under this Act, and

(c) any matter necessary to enable the Bank to effectively carry out its purposes, exercise and perform its powers and duties, and carry on its business.

(1) Any person who contravenes or fails to comply with any provision of this Act shall be guilty of an offence and shall, on conviction after summary trial before a Magistrate, be liable to a fine not exceeding five thousand rupees or to imprisonment of either description for a term not exceeding one year, or to both such fine and imprisonment.

(2) Where an offence under this Act is committed by a body of persons, then,-

(1) Notwithstanding the provisions of sections 117 and 118 of the Monetary Law Act, Central Bank is hereby to subscribe to the capital of, and to purchase, guarantee or accept as security, any shares, stock, debentures, promissory notes or other securities issued by the Bank.

(2) Notwithstanding anything to the contrary in any other written law the Bank of Ceylon and the People’s Bank are hereby authorized to subscribe to the capital of the Bank.