Corporate Restructuring Companies Act, 2016

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Updated till 07.07.2022 
 
 
 
THE CORPORATE RESTRUCTURING COMPANIES ACT, 2016 
 
CONTENTS 
 
 
 
SECTIONS 
 
1. Short title, extent and commencement. 
 
2. Definitions. 
 
3. Act to override other laws, contracts, instruments, memorandum and articles. 
 
4. Incorporation of Corporate Restructuring Company. 
 
5. Functions and powers. 
 
6. Transfer of non•performing assets. 
 
7. Legal proceedings. 
 
8. Notice and discharge. 
 
9. Power to require information. 
 
10. Special audit. 
 
11. Inquiry by the Commission. 
 
12. Destruction of documents. 
 
13. Penalty for non•compliance or contravention. 
 
14. Enforcement of orders of the Commission. 
 
15. Power to make rules. 

Page 2 of 15  
16. Power to make regulations. 
 
17. Power to issue directives, circulars, guidelines, etc. 
 
18. Power to remove difficulties. 
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THE CORPORATE RESTRUCTURING COMPANIES ACT,  2016 
 
ACT No. XXXII OF 2016  
[28th June, 2016] 
 
An Act to provide for the establishment and regulation of corporate restructuring companies 
 
WHEREAS it is expedient to provide for the establishment, licensing and regulation of 
corporate restructuring companies and the manner in which they can carry on business; 
 
It is hereby enacted as follows:⸺ 
 
1. Short title, extent and commencement. —(1) This Act shall be called the Corporate  
Restructuring Companies Act, 2016. 
 
(2) It extends to the whole of Pakistan. 
 
(3) This section shall come into force at once and the rem aining provisions of this Act shall  
come into force on such date as the Federal Government may, by notification in the official Gazette,  
appoint and different dates may be so appointed for different provisions of this Act. 
 
2. Definitions.—(1) In this Act, unless there is anything repugnant in the subject or context,— 
 
(i) “affiliate” means a shareholder, director, employee, agent or adviser of a  
financial institution and includes an entity that directly or indirectly controls or 
is controlled by such financial institution, and a shareholder, director, employee, 
agent or adviser of such entity; 
 
(ii) “collateral” means a property in relation to  which security interest of any  
description has been created; 
 
1[(iia) “Companies Act” means the Companies Act, 2017 (XIX of 2017);] 
 
(iii) “control” means direct or indirect ownership of fifty percent or more of the  
voting rights in an entity; 
 
(iv) “corporate restructuring company” means a public limited company licensed by 
the Commission under this Act to carry out the business of,- 
 
(a) acquisition, management, restructuring and resolution of non - 
performing assets of financial institutions 1[save as otherwise  
provided for in section 8A] ; and 
 
(b) restructuring, reorganization, revival and liquidation of 
commercially or financially distressed companies and their 
businesses. 
 
(v) “Commission” means the Securities and Exchange Commission of Pakistan; 
 
1Ins. and added by the Corporate Restructuring Companies (Amendment) Act, 2021 (XXXII of 2021), s. 2. 
Page 4 of 15  
1[* * * * * * *] 
 
(vii) “financial asset” includes any short, medium or long term interest and 
non•interest bearing loan, finance, advance, lease, installment, term finance  
certificate, participation term certificate, modaraba, musharaka, ijara, profit 
and loss sharing agreement,  redeemable capital, guarantee or contractual right  
to receive payment of money in respect of sums advanced or committed to an  
obligor by a financial institution; 
 
(viii) “financial institution” means a financial institution as defined under clause (a)  
of section  2 of the Financial Institutions (Recovery of Finances) Ordinance,  
2001 (XLVI of 2001); 
 
(ix) “Government Agency” means a department, agency or a body corporate set up  
or established by the Federal Government or a Provincial Government and  
includes the Federal Government and a Provincial Government itself; 
 
(x) “non•performing asset” means a financial asset held on the books of a financial 
institution with respect to which the obligor has been in arrears for more than  
one year on any payment obligation 2[or which has been classified by the  
financial institution as a loss in its books in accordance with the applicable laws] 
and includes all security interests with respect thereto; 
 
(xi) “obligor” means any individual, proprietorship, partnership, trust, company or  
other entity that has, with respect to a financial asset, a contractual or legal  
obligation to make payment, effect performance, provide security or collateral, 
whether as principal, surety, guarantor or otherwise and whether such obligation 
is primary, secondary, matured or contingent; 
 
1[* * * * * * *] 
 
(xiii) “person” includes an individual, partnership, firm and company but does not  
include a Government agency; 
 
(xiv) “prescribed” means prescribed by rules or regulations made under this Act; 
 
(xv) “property” means property of any description, movable or immovable, tangible 
or intangible, and rights, interests, title and claims attached to property, whether 
certain or contingent, existing or arising in future, and shall include documents 
of title pertaining to a property; 
 
(xvi) “regulations” means regulations made by the Commission under this Act; 
 
(xvii) “rules” means rules made by the Federal Government under this Act; 
 
(xviii) “security interest” means a guarantee, charge, mortgage, lien, hypothecation,  
pledge, assignment or any other security interest in relation to collateral; 
 
1Omitted clause VI and XII by the Corporate Restructuring Companies (Amendment) Act, 2021 (XXXII of 2021), s. 2. 
2Ins. certain words ibid. 
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(xix) “SECP Act” means the Securities and Exchange Commission of Pakistan Act,  
1997 (XLII of 1997); 
 
(xx) “speculative transaction” means a transaction which,— 
 
(a) substantially relates to the purchase or sale of any commodity,  
including bonds, debentures, shares or right to, or interes t in,  
property of any description; 
 
(b) provides for settlement or execution otherwise than by actual  
delivery or transfer of such commodity; 
 
(c) secures against loss on account of price fluctuations and risks  
associated with volatility in market; and 
 
(d) may be prescribed by the Commission from time to time; 
 
(xxi) “transferor” means the financial institution which enters into the transfer and  
assignment agreement provided in clause (a) of sub•section (1) of section 6; and 
 
1[(xxia) “trust” means a trust constituted pursuant to section 6A;] 
 
(xxii) “vesting date” means the date of signing of the transfer and assignment 
agreement between a financial institution and a Corporate Restructuring 
Company as provided in clause (b) of sub•section (1) of section 6. 
 
(2) The words and expressions used but not defined in this Act shall have the same meaning 
as is assigned to them in the 2[Companies Act] or the SECP Act. 
 
3. Act to override other laws, contracts, instruments, memorandum and articles. —Save 
as otherwise expressly provided in this Act, the provisions of this Act shall have effect notwithstanding 
anything to the contrary contained in any other law, contract, instrument, memorandum or articles of  
a company or in any agreement executed by a company or in any resolution passed by the company in 
a general meeting or by its directors, whether the same is registered, executed or passed, before or after 
the commencement of this Act. 
 
4. Incorporation of Corporate Restructuring Company.—(1) No Corporate Restructuring 
Company shall be incorporated without the prior approval of the Commission. 
 
(2) No Corporate Restructuring Company shall carry on business unless it is established as a  
public limited company under the 2[Companies Act] and holds a licence issued in this behalf by the  
Commission and any such licence may be issued subject to such general or special conditions and  
upon payment of such fee as the Commission may deem fit to impose. 
 
5. Functions and powers.—(1) Subject to the provisions of section 4, a Corporate 
Restructuring Company may exercise one or more of the following functions and powers, namely:— 
 
(a) to acquire, buy, hold, manage, restructure, reschedule, resolve, settle, recover, 
 
 
1Ins. new clause (XXIa) by the Corporate Restructuring Companies (Amendment) Act, 2021 (XXXII of 2021), ss. 2-3. 
2Subs, for “ordinance” ibid. 
Page 6 of 15  
assign, transfer and dispose of non­performing assets; 
 
(b) to deal with any loan, advance, financial commitment, lease, hire• 
purchase, rental, sale and buy•back arrangement, mudaraba, musharaka, ijara 
or other financial transaction or security interest relating to non•performing  
assets; 
 
(c) to acquire, take over, hold, re•organize, restructure, encumber, assign, sell, lease 
and otherwise deal with any asset, property, undertaking or collateral with  
respect to non•performing assets; 
 
(d) to acquire, hold, manage, restructure, reorganize, revive, merge, amalgamate,  
lease, liquidate, assign and dispose of distressed companies, their businesses  
and properties; 
 
(e) to advise, develop, advance, support, implement and raise finances for 
rehabilitation, restructuring, reorganization or liquidation of distressed 
companies, their businesses and properties; 
 
(f) to enter into partnerships, joint venture agreement, profit or loss sharing 
arrangement or otherwise collaborate or participate with any company or other 
person in relation to non•performing assets or distressed companies; 
 
(g) to commence, continue, defend, desist, enforce, implement and perform any and 
all actions or activities in relation to non•performing assets and distressed  
companies; 1[*] 
 
(h) to establish, promote, concur or participate in establishing or promoting any  
company or other entity, the establishment or promotion of which may seem,  
directly or indirectly, to benefit its business 2[;] 
 
3[(i) to provide finance as defined in the Financial Institutions (Recovery of 
Finances) Ordinance, 2001 (XLVI of 2001) for carrying out the purposes of this 
Act; 
 
(j) to establish and provide management services to trusts in terms of section 6A; 
 
(k) to act as an agent for any financial institution for the purpose of recovering their 
non-performing assets as provided under section 6B; and 
 
(l) to develop and implement a scheme in terms of section 8A.] 
 
(2) No Corporate Restructuring Company or its directors, officers and agents shall perform any 
function and exercise any power under this Act so as— 
 
(a) to involve in speculative transactions; 
 
(b) to aid an obligor with the sole object to avoid its debt obligations or performance 
of a contract, remove its assets and properties from the reach of its creditors, 
 
1Omitted the word “and” by the Corporate Restructuring Companies (Amendment) Act, 2021 (XXXII of 2021), s.4. 
2Subs. for “full stop” Ibid. 
3Ins. new clauses from “I to L” Ibid. 
Page 7 of 15  
evade payment of any tax, duty or other fiscal charge to Government Agency; 
 
(c) to circumvent fair valuation and proper appraisal of non•performing assets and 
the collateral thereof by reputable evaluating and appraising entities; 
 
(d) to transact business other than at arm's length; and 
 
(e) not to comply with the applicable laws, except as expressly provided otherwise 
under this Act. 
 
6. Transfer of non•performing assets.—(1) Notwithstanding anything to the contrary 
contained in any law, decree, judgment, order, contract, instrument or document,— 
 
(a) a financial institution may, with the prior approval of its Board of Directors,  
transfer and assign its non•performing  assets to a Corporate Restructuring  
Company, other than a Corporate Restructuring Company 1[* * *] controlled by 
such financial institution or its affiliates, 2[subject to clause (e) of sub -section 
(1),] by entering into a transfer and assignment agreement with it on such terms 
and conditions as may be mutually agreed upon between them; 
 
(b) on the vesting date, all rights, title, interest, benefits, privileges and remedies of 
such financial institution, concerning the non•performing assets and the 
obligors thereto, shall stand transferred, assigned, conveyed, sold and vested in 
favour of the Corporate Restructuring Company without the need of any further 
action, agreement or instrument; 
 
(c) the transfer and assignment agreement shall not be required to be compulsorily 
registered under any law; 3[*] 
 
(d) all contracts, deeds, instruments, approvals, commitments or consents relating  
to the non•performing assets subsisting or having effect immediately before the 
vesting date and to which the transferor may have been a party or beneficiary  
shall be of full force and effect in favour of or against the Corporate 
Restructuring Company and  may be enforced or acted upon as fully and  
effectively as if, in the place of such financial institution, the Corporate 
Restructuring Company had been a party or beneficiary 4[; and] 
 
5[(e) any transfer or assignment of non -performing assets pursuant to the transfer and 
assignment agreement shall be deemed to be affected by operation of law and  
not— 
(i) by virtue of execution of such agreement by any party thereto;  
and 
(ii) constitute any assignment, transfer, devolution, conveyance, 
lease, consent order, alienation, parting with possession or any  
other disposition under any applicable law other than the 
provisions of section 6.] 
 
1Omitted the words “established, owner or” by the Corporate Restructuring Companies (Amendment) Act, 2021 (XXXII of 2021), s. 5. 
2Ins. certain words, Ibid. 
3Omitted the word “and ” Ibid. 
4Subs. and ins. for the “full stop” Ibid. 
5Added new clause (e) Ibid. 
1Ins. new “sections 6A and 6B” by the Corporate Restructuring Companies (Amendment) Act, 2021 (XXXII of 2021), s. 6. 
Page 8 of 15 
 
(2) The rights, powers and remedies provided to a Corporate Restructuring Company under  
this Act may be exercised separately or concurrently by it and are in addition to and not in lieu or  
derogation of any other rights or remedies that it or any other person may legally have in respect of  
non•performing assets and the collateral thereof. 
 
1[6A. Creation of trust.⸺(1) A Corporate Restructuring Company may constitute one or more 
trusts under the Trusts Act, 1882 (II of 1882) for the purpose of acquiring non-performing assets from 
financial institutions. 
 
(2) A trust  constituted under sub-section (1)  may acquire  non-performing assets from a  
financial institution in accordance with section 6, provided that the transfer and assignment agreement 
shall be entered into by the Corporate Restructuring Company, for and on behalf of the trust. 
 
(3) The management of any trust constituted under sub-section (1) shall vest in the Corporate  
Restructuring Company on the terms set forth in the constitutive document of such trust. 
 
(4) The trust may be liquidated in a manner as may be prescribed. 
 
(5) For the purpose of giving effect to section 6A, the references in this Act to a Corporate  
Restructuring Company shall, unless repugnant to the context, include a trust established under section 
6A. 
 
6B. Appointment of a Corporate Restructuring Company as a recovery agent.⸺A 
financial institution may appoint a Corporate Restructuring Company as its agent for recovery of its  
non-performing assets by entering  into an agency agreement  with such Corporate Restructuring  
Company on such terms and conditions as may be mutually agreed between them: 
 
Provided that in case an agency relationship, there shall be no transfer of any non -performing 
assets to Corporate Restructuring Company.] 
 
7. Legal proceedings.—(1) All proceedings by or against a transferor relating to the non•  
performing assets transferred to a Corporate Restructuring Company and the obligors and collateral  
thereof, which may be pending before any Court, tribunal, arbitrator or authority immediately before  
the vesting date, shall— 
 
(a) be continued, prosecuted, defended, enforced and  executed by or against the  
Corporate Restructuring Company in the same manner and to the same extent  
as would have been continued, prosecuted, defended, enforced and executed by 
or against the transferor; 
 
(b) proceed from the stage which such proceedings had reached on the vesting date 
and shall not require any fresh filing, recalling and rehearing of any witness or  
recording of any evidence already completed; and 
 
(c) be continued, decided and disposed of in accordance with the provisions of the 
respective law, as amended or re•enacted, under which the same were instituted 
or filed. 
1Ins. new “sections 7A and 7B” by the Corporate Restructuring Companies (Amendment) Act, 2021 (XXXII of 2021), s. 7. 
Page 9 of 15 
 
(2) Any new proceedings by or against the Corporate Restructuring Company may be instituted 
and shall be entertained, adjudicated and disposed of in accordance with the laws, as amended or re•  
enacted, under which proceedings were authorized to be instituted by or aga inst the transferor,  
respectively, including the Financial Institutions (Recovery of Finances) Ordinance, 2001 (XLVI of  
2001), the Ordinance, the Offences in Respect of Banks (Special Courts) Ordinance, 1984 (IX of  
1984), Code of Civil Procedure, 1908 (Act V of 1908) and the Code of Criminal Procedure, 1898 (Act 
V of 1898). 
 
(3) Without prejudice to the provisions of sub•section (2), a Corporate Restructuring Company 
shall be deemed to be a financial institution for the purposes of clause (a) of section 2 of the Financial 
Institutions (Recovery of Finances) Ordinance, 2001 (XLVI of 2001) but shall not be treated as a  
banking company under the Banking Companies Ordinance, 1962 (LVII of 1962). 
 
(4) Any reference to the transferor in the proceedings referred to in this section, the record and 
documents of such proceedings or decrees, judgments and orders passed in such proceedings shall,  
except where the context otherwise requires, be construed and read as reference to the Corporate  
Restructuring Company. 
 
(5) Without prejudice to the provisions of the foregoing sub•sections, the Corporate 
Restructuring Company may submit an application supported by the affidavit of its chief executive  
officer, containing particulars of the proceedings mentioned under sub•section (1), w ith the Registrar 
of the court, tribunal, arbitrator or authority before which such proceedings are pending and on receipt 
of such affidavit the name of the Corporate Restructuring Company in place of the transferor, as the  
case may be, shall be substituted. 
 
1[7A. Exchange of information.⸺(l) For the purposes of this Act, financial institutions may  
exchange information relating to an obligor on confidential basis with the Corporate Restructuring  
Company. 
 
(2) No suit or other legal proceedings sh all lie against any financial institution or its officers,  
for anything done in good faith in pursuance of this section or for any damage caused or likely to be  
caused by anything done or intended to be done as aforesaid. 
 
7B. Credit institution.⸺A Corporate Restructuring Company shall be deemed to be a credit  
institution for the purposes of the Credit Bureaus Act, 2015 (XI of 2015).] 
 
8. Notice and discharge. —(1) A Corporate Restructuring Company may, on or after the  
vesting date, give a duly signed and sealed notice of transfer of the non•performing assets to the  
obligors, State Bank of Pakistan, Commission and any other concerned person, including, to the  
registering authority in whose jurisdiction any security interest with respect to such non•perf orming 
assets or any other interest concerning the collateral or any indebtedness of the obligors relating to the 
non•performing assets, had been recorded or registered. 
 
(2) A transfer and assignment agreement shall not be effective as against the obligors of  the 
non•performing assets transferred by such agreement until due notice thereof is provided to such  
obligors. 
 
(3) Subject to sub•section (2), the obligors of the non•performing assets transferred and 
1Ins. new “sections 8A and 8B” by the Corporate Restructuring Companies (Amendment) Act, 2021 (XXXII of 2021), s. 8. 
Page 10 of 15 
 
assigned to a Corporate Restructuring Company by a financial institution shall make payment to the  
Corporate Restructuring Company and obtain any effective discharge from it after retirement of their  
liabilities to the entire satisfaction of the Corporate Restructuring Company. 
 
1[8A. Scheme.⸺(1) A Corporate Restructuring Company, holding at least two -third in value 
of the principal amount payable to the secured financial institutions, may present a scheme to the  
Corporate Restructuring Board which may sanction such a scheme, subject to the provisions of this  
Act. 
 
(2) For the purpose of determining the requisite majority of secured financial in stitutions as 
provided in sub-section (1), the Corporate Restructuring Company⸺ 
 
(a) may rely on the publicly available information with the Registrar of Companies; 
and 
 
(b) shall send a notice to the secured financial institutions in terms of which the  
secured financial institutions shall be required to swear, within fourteen 
calendar days of such notice, an affidavit in relation to the following, namely:— 
 
(i) specify the principal amount owed and outstanding from the  
obligor together with the nature and extent of their security  
interest; 
 
(ii) basis on which the executant of the affidavit is authorized to  
execute and bind the concerned financial institution; and 
 
(iii) any other matters as may be required by the Corporate 
Restructuring Company or as may be prescribed. 
 
(3) If the affidavit provided by any person is false or incorrect in any material respect, or omits 
any material fact, knowing it to be material or such person fails to provide the same within the time  
frame or in the manner set forth in sub-section (2), the Commission, in consultation with the Corporate 
Restructuring Board, may impose a penalty on such a person of an amount not exceeding fifty million 
Rupees and such penalty shall be in addition to and without prejudice to any other remedy available  
to any party that may have been effected by a false affidavit or due to the failure to provide the affidavit. 
 
(4) The Corporate Restructuring Board shall, upon receipt of a scheme from a Corporate  
Restructuring Company in terms of sub -section (1) and in the manner and period prescribed, invite  
objections to the same. 
 
(5) If the Corporate Restructuring Board on consideration of the objections is of the view that  
the objections are not valid, it may sanction the scheme. 
 
(6) If the scheme is sanctioned by the Corporate Restructuring Board, by virtue of the scheme, 
the same shall be binding on the concerned obligor, all its creditors of whatsoever nature, its members 
and shareholders, its liquidators and other persons who have any interest in the company, pecuniary or 
otherwise, and shall have effect without requiring compliance with and notwithstanding any⸺ 
Page 11 of 15  
(a) other law for the time being in force; 
 
(b) agreement or contract entered into or applicable to the concerned obligor; and 
 
(c) agreement or contract entered into inter se financial institutions and other creditors of 
the concerned obligor. 
 
(7) The Corporate Restructuring Board may refuse to sanction the scheme where it is satisfied 
that either the scheme suffers from illegality or procedural requirements of this Act or the rules made  
thereunder have not been complied with. 
 
(8) The provisions of clause (e) of sub-section (1) of section 6 shall apply mutatis mutandis to 
a scheme sanctioned by the Corporate Restructuring Board under this section. 
 
(9) Any person aggrieved by the order of the Corporate Restructuring Board may, within thirty 
days of the date of such order, file a petition for leave to appeal in the High Court having jurisdiction. 
 
(10) When a scheme is presented to the Corporate Restructuring Board in terms of sub-section 
(1), no suit or other legal proceedings shall be proceeded with or commenced against the obligor until 
the scheme is sanctioned by the Corporate Restructuring Board and has attained finality in terms of  
sub-section (9) or such sanction has been refused by the Corporate Restructuring Board, whichever is 
earlier. 
 
(11) Upon sanctioning of the scheme and the same having attained finality in terms of sub - 
section (6), all suits or other legal proceedings pending against the obligor shall stand abated, provided 
that a scheme may provide for continuation of any suit or proceeding set forth therein. 
 
(12) Sections 279 to 283 of the Companies Act shall not apply to any scheme under this section. 
 
(13) Notwithstanding anything contained in any other law, no civil court as provided for in the 
Code of Ci vii Procedure, 1908 (V of 1908) or any other court shall have jurisdiction to entertain any 
suit or proceeding in respect of any matter which the High Court is empowered to determine by or  
under this section. 
 
(14) For the purposes of the is section,⸺ 
 
(a) “High Court” means the High Court of the Province where registered office of  
the Corporate Restructuring Company is located; and 
 
(b) “Corporate Restructuring Board” means a board notified by the Federal 
Government in the official Gazette comprising of not more than five members  
who shall be professionals having experience and sound knowle dge of dealing 
with company law or recovery of non -performing assets or restructuring and  
rehabilitation of companies in financial distress, and in this regard, subject to  
the foregoing, any or all of the following matters may be prescribed through  
rules, namely:⸺ 
 
(i) functions of the Corporate Restructuring Board and its members; 
 
(ii) composition, appointment and governance of the Corporate 
Restructuring Board and its code of conduct; 
Page 12 of 15  
(iii) remuneration and privileges of members of the Corporate 
Restructuring Board; 
 
(iv) eligibility and qualifications of the members of the Corporate 
Restructuring Board; 
 
(v) budgetary allocation for the proper functioning of the Corporate 
Restructuring Board and its staff and matters  connected to its  
accountability; and 
 
(vi) any other matter that may be considered necessary or expedient  
for the purpose of furthering the objectives of this section. 
 
(c) “Scheme” means any arrangement, for the purpose of achieving the objectives  
of this Act, e ntered into amongst  the obligor, the Corporate Restructuring  
Company and one or more secured financial institutions, that contains one or  
more of the following, namely:⸺ 
 
(i) the sale or lease of a part or whole of the business or assets of  
the obligor; 
 
(ii) rescheduling of payments of debt payable by the obligor; 
 
(iii) enforcement of any pledge by a third party securing the 
obligations of the obligor; 
 
(iv) settlement of dues payable by the obligor; 
 
(v) conversion of any portion of debt into ordinary shares of the  
obligor; 
 
(vi) conversion of any portion of debt into assets or properties of the 
obligor; 
 
(vii) matters connected with pending suits and other  proceedings 
against the obligor, including in connection with their 
abatement; and 
 
(viii) provisions that are incidental or conducive to facilitating, 
promoting or advancing any matter referred to in sub-clauses (a) 
to (g) or such other matter as may be prescribed. 
 
(d) “Secured financial institutions” means in relation to an obligor, all financial  
institutions that have created a security interest over any or all of the assets or  
properties of the obligor, irrespective of⸺ 
 
(i) whether such security interest is shared amongst such financial  
institutions as a syndicate or otherwise; 
 
(ii) ranking of such security interest amongst such financial 
institutions; and 
Page 13 of 15  
(iii) whether such security interest secures a non-performing asset. 
 
8B. Special bench of High Court.⸺(1) The High Courts shall constitute one or more special 
benches consisting of one or more Judges to adjudicate the cases under this Act. 
 
(2) The special benches as constituted under sub-section (1) shall decide the cases in 
accordance with the procedure prescribed through rules, if any, within ninety days from the date of  
institution of the case.] 
 
9. Power to require information. —(1) The Commission may, at any time, by notice in  
writing, require one or more Corporate Restructuring Companies and their management to furnish it,  
within the time specified therein or such further time as the Commission may allow, an y statement, 
information or document relating to the business or affairs of such Corporate Restructuring 
Companies. 
 
(2) No Corporate Restructuring Company or its director, officer, employee, auditor or agent  
shall, in any document, prospectus, report, return, accounts, information or explanation required to be 
furnished in pursuance of this Act or the rules or regulations made thereunder, make any statement or 
give any information which he knows or has reasonable cause to believe to be false or incorrect or 
omit any material fact therefrom. 
 
10. Special audit.⸺(1) The Commission shall monitor the general financial condition of the  
Corporate Restructuring Companies and may, at its discretion, order special audit and appoint an  
auditor to carry out detailed scrutiny of the affairs of one or more Corporate Restructuring Companies 
and the Commission may, at any time, issue such directions as it may deem appropriate. 
 
(2) The Commission may, during the course of special audit, pass such interim orders and  
directions as it may deem appropriate. 
 
(3) On the basis of the special audit report, the Commission may direct a Corporate 
Restructuring Company and its management to do or to abstain from doing such acts that may secure  
the interest of its shareholders and creditors and any such directions shall be complied within such  
time as may be specified by the Commission. 
 
(4) The provisions of 1[section 249 of the Companies Act] shall apply mutatis mutandis to the 
auditor appointed to carry out the special audit of the Corporate Restructuring Company. 
 
11. Inquiry by the Commission. —(1) On the complaint of any concerned person or on its  
own motion, the Commission may, on the basis of material available with it, cause an inquiry or  
inspection to be made by any person appointed in this behalf into the affairs of a  Corporate 
Restructuring Company or its directors, officers or an associated company or undertaking. 
 
1Subs. for “section 255 of the ordinance ” by the Corporate Restructuring Companies (Amendment) Act, 2021 (XXXII of 2021), s. 9. 
Page 14 of 15  
(2) Where an inquiry or inspection under sub•section (1) has been ordered, the director, officer 
or associated company or undertaking to which the enquiry or inspection relates and every other person 
who has had any dealing with the Corporate Restructuring Company, its director, officer or associated 
company shall furnish such information in his custody or power or within his knowledge relating to or 
having bearing on the subject-matter of the inquiry or inspection as the person conducting the enquiry 
or inspection may by notice in writing require. 
 
(3) The person conducting an inquiry or inspection under sub•section (1) may call for, inspect 
and seize books of account and documents in possession of the Corporate Restructuring Company  or 
its directors, officers or associated companies. 
 
(4) Upon completion of the inquiry or inspection, a formal report will be submitted to the  
Commission about the outcome of the inquiry or inspection and the Commission may, after sharing  
the inquiry or inspection report, and where deemed appropriate, after providing an opportunity of  
hearing to the Corporate Restructuring Company, pass such directions or orders, including imposition 
of fine, as it deems fit. 
 
12. Destruction of documents. ⸺No person shall destroy, falsify, conceal or dispose of, or  
cause or permit the destruction, falsification, concealment or disposal of, any document, which he  
knows or ought to know is relevant to an inquiry, inspection, auditor has been called by the  
Commission. 
 
13. Penalty for non•compliance or contravention.—(1) Notwithstanding anything contained 
in any other provision of this Act, if a Corporate Restructuring Company or its affiliate or associated  
company fails or refuses to comply with or knowingly contravenes any provision contained in this Act 
or of any of the provisions of the rules or regulations made thereunder or any order or direction or  
directives or  circular passed by the Commission under the provisions contained  in this Act  or 
knowingly and willfully autho rizes or permits such failure, refusal or contravention or makes a false  
statement, shall, in addition to any other penalty provided by law, be liable to a fine of an amount not  
exceeding fifty million rupees and for a further fine of two hundred thousand rupees for every day,  
after the first day, during which the contravention continues. 
 
(2) Without prejudice to the provisions of sub•section (1), in case of contravention of any  
provision of this Act or the rules or regulations made thereunder or non•compliance of any direction 
given or order passed thereunder by the Commission, the Commission may cancel the licence of a  
Corporate Restructuring Company, after issuing a show cause notice and giving it an opportunity of  
being heard, or pass any other order which may be deemed appropriate by the Commission. 
 
(3) Upon cancellation of the licence, the functions and carrying on the business of a Corporate 
Restructuring Company shall cease and the Commission may move the Court having jurisdiction for  
winding up of the Corporate Restructuring Company. 
 
14. Enforcement of orders of the Commission. —(1) Any fine imposed by the Commission  
in the exercise of its powers under this Act shall be payable to the Commission and may be recovered 
by the Commission as arrears of land revenue. 
 
(2) Any amount which cannot be recovered as arrears of land revenue may be recovered as a  
decree for the payment of money under the Code of Civil Procedure, 1908 (Act V of 1908). 
Page 15 of 15  
(3) The Commission may issue such directions as may be necessary or expedient to give effect 
to its orders or to prevent abuse of its process, including but not limited to, seeking the assistance of  
the local administration or Police who shall be bound to provide assistance. 
 
15. Power to make rules. —(1) The Federal Government may, by notification in the official  
Gazette, make rules for carrying out the purposes of this Act. 
 
(2) All rules made under sub•section (1) shall be subject to previous publication for eliciting  
public opinion thereon. 
 
16. Power to make regulations.—(1) The Commission may, by notification in the official  
Gazette make regulations, not inconsistent with the rules, for carrying out the purposes of this Act. 
 
(2) All regulations made under sub•section (1) shall be subject to previous publication for  
eliciting public opinion thereon. 
 
17. Power to issue directives, circulars, guidelines, etc. ⸺The Commission may from time  
to time issue such directives, circulars, guidelines, etc. as may be necessary for carrying out the  
purposes of this Act or the rules and regulations made thereunder. 
 
18. Power to remove difficulties.⸺If any difficulty arises in giving effect to the provisions of 
this Act, the President may, by notification in the official Gazette, make an order not inconsistent with 
the provisions of this Act for removing the difficulty. 
 
1[19. Validation of Laws.—Notwithstanding anything contained in any other law, all transfer 
of non-performing assets undertaken, orders made, proceedings taken and act done, rules, regulation,  
circulars, notification and other legal instruments made at any time until the enactment of the Corporate 
Restructuring Companies (Amendment) Act, 2021 are declared and affirmed to have been and shall  
deemed to have always been, validly undertaken, made, decided, taken or done and shall not be called 
in question in any court on any ground whatsoever.] 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1Ins. new “section 19”by the Corporate Restructuring Companies (Amendment) Act, 2021 (XXXII of 2021), s. 10.