16.
| (1) In any case where the Director of Bank Super vision of the Central Bank of Ceylon is satisfied, after the examination by himself or by any officer authorized by him, of the affairs of any Institution, or upon information received from the Institution, that the Institution is insolvent or is likely to become unable to meet the demands of its depositors, or that its continuance in business is likely to involve loss to its depositors or creditors, the Director shall make a report accordingly to the Governor of the Central Bank of Ceylon for submission to the Board; and if the Board, upon review of the facts and circumstances, is of opinion that action should be taken as hereinafter provided, the Board may make order directing the Institution forthwith to suspend business in Sri Lanka and directing the Director to take charge of all books, records and assets of the Institution and to take such measures as may be necessary to prevent the continuance of business by the Institution. |
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| (2) Notwithstanding anything in any written or other law, no action or proceeding may be instituted in any court for the purpose of securing the review or revocation of any order made under subsection (1) or in respect of any loss or damage incurred, or likely to be or alleged to be incurred. by reason of such order. |
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| (3) An order made by the Board under subsection (1) In respect of any Institution shall cease to have effect upon the expiration of a period of thirty days from the date on which it is made ; and it shall be the duty of the Board, as soon as practicable and in any event before the expiration of the said period, to-
| | (a) make order permitting the Institution to resume business, either unconditionally or subject to such conditions as the Board may consider necessary in the public interest or in the interests of the depositors and other creditors of the Institution; or | | |
| | (b) to cause the Director of Bank Supervision to make application as hereinafter provided to the competent court for the winding up of the Institution. | | |
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| (4) The competent court may, on any application made by the Director of Bank Supervision, order the winding up of-
| | (a) any Institution which is a company, and accordingly, the provisions of the Companies Ordinance relating to the winding up of companies subject to the super- vision of court shall apply mutans mutandis to the winding up of such Institution; or | | |
| | (b) any Institution which is a person other than a company) or an unincorporate body of persons and in any such winding up where the assets of the Institution are not sufficient to meet its liabilities, the court may order that the assets of that person or of every individual constituting that body be made available to the liquidator for the purpose of the winding up of such Institution. | | |
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| (5) In the winding up of an Institution under paragraph (b) of subsection (4) the value of the assets and liabilities of the Institution shall be ascertained in such manner and upon such basis as the liquidator thinks fit. The component court may, at any time after making a Winding-up order, authorize the liquidator to realize all assets and may require any person to pay, deliver, convey, surrender, or transfer forthwith, or within a specified time to the liquidator any money, property, or books and papers in his hands to which the Institution is entitled. A scheme for the purpose of the winding up of the Institution shall be prepared by the liquidator and submitted for confirmation to the competent court and the winding up of the Institution shall be carried out according to such scheme. |
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| (6) In any case where an order is made, whether in pursuance of an application under this section or otherwise, for the winding or of any Institution, then, notwithstanding any thing in any other written law, the Director of Bank Super vision or any person authorized in that behalf by the Board shall be appointed to be the liquidator for the purposes of such winding up. |
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| (7) Where an order is made to wind up an Institution other than a company, the remuneration of the liquidator appointed under subsection (6) and all costs, charges and expenses properly incurred in the winding up shall be payable in priority to all other claims, notwithstanding any thing in any other written law to the contrary, out of the assets of the Institution that is being wound up. |
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| (8) Where an order has been made by the Board under subsection (3) permitting the resumption of business by any Institution subject to such conditions as may be specified in the order, the competent court may, on application made to it in that behalf by the Institution at any time while the order is in force, make a declaration permitting the Institution to resume business unconditionally, or varying or altering, in such manner as the court may determine, all or any of the conditions specified by the Board ; and any such declaration shall have effect notwithstanding anything in the order made by the Board under subsection (3). |
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| (9) In any case where application is made by the Director as provided in subsection (3) for the winding up of any Institution-
| | (a) the Institution shall not carry on business during the pendency of the application unless it is authorized so to do by the court and except in accordance with such conditions, if any, as may be specified by the court; and | | |
| | (b) the court, if it is of opinion after such inquiry as it may consider necessary, that the Institution is not insolvent, may make a declaration permitting the Institution to resume business either unconditionally or subject to such conditions as the court may consider necessary in the public interest or in the interests of the depositors and other creditors of the Institution. | | |
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| (10) Every order made by a competent court under this section shall be subject to an appeal to the Supreme Court and the provisions of the Civil Procedure Code relating to appeals in civil actions shall apply mutatis mutandis in the case of any such appeal: |
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| (11) Every application to a competent court under this section shall be deemed to be an action of the value of five thousand rupees. |
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| (12) In this section, "competent court", in relation to any Institution means the District Court of Colombo or of the district in which the principal office in Sri Lanka of the Institution is maintained. |
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| (13)
| | (a) Any proprietor, partner, director, manager, secretary or employee of any Institution who fails to furnish any information or to produce any book, record or other document when requited so to do by the Director of Bank Supervision or by any officer authorized by such Director, or who obstructs or fails to permit the Director of Bank Supervision or any officer authorized by such Director to make any examination under this section or under section 15, shall be guilty of an offence. | | |
| | (b) Any person who in any report or information furnished to the Director of Bank Supervision, or to any officer authorized by the Director of Bank Supervision under this section or under section 15 makes any statement which he knows to be false, shall be guilty of an offence. | | |
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Sri Lanka Consolidated Acts