Section 244 — Unclaimed shares, modaraba certificates and dividend to vest with the Federal Government

(1) Notwithstanding anything to the contrary
contained in this Act or any other law—

(i) where shares of a company or modaraba certificates of a Modaraba
have been issued; or

(ii) where dividend has been declared by a company or Modaraba;

which remain unclaimed or unpaid for a period of three years from the date it is due
and payable, or

(iii) any other instrument or amount which remain unclaimed or unpaid,
having such nature and for such period as may be specified;

the company shall give ninety days notices to the shareholders or certificate
holders or the owner, as the case may be, to file claim, in the following manner—

(a) by a registered post acknowledgement due on his last known
address; and

(b) after expiry of notice period as provided under clause (a), final
notice in the specified form shall be published in two daily
newspapers of which one will be in Urdu and one in English having
wide circulation.

Explanation.—For the purpose of this section “shares” or “ modaraba
certificates” include unclaimed or undelivered bonus shares or modaraba
certificates and “company” includes a “modaraba company”.

(2) If no claim is made before the company by the shareholder,
certificate holder or the owner, as the case may be, the company shall after ninety
days from the date of publication of notice under clause (b) of sub -section (1)
shall—

(a) in case of sum of mo ney, deposit any unclaimed or unpaid amount
to the credit of the Federal Government; and

(b) in case of shares or modaraba certificates or other instrument, report
and deliver to the Commission such shares or modaraba certificates
or other instrument and the Commission shall sell such shares or
modaraba certificates or other instrument, as the case may be, in the
manner and within such period as may be specified and deposit the
proceeds to the credit of Federal Government:

Provided that where the company has deposited the
unclaimed or unpaid amount or delivered the shares or modaraba
certificates or other instrument with the Commission for credit of
the Federal Government, the company shall preserve and continue
to preserve all original record pertaining to the deposited unclaimed
or unpaid amount and the shares or modaraba certificates or other
instrument and provide copies of the relevant record to the
Commission until it is informed by the Commission in writing that
they need not to be preserved any longer.

(3) Notwithstanding anything contained in any law or procedure for the
time being in force, the unclaimed or unpaid amount as well as the proceeds from
the sale of shares or modaraba certificates or any other in strument or any benefit
accrued thereon, as the case may be, shall be maintained in a profit bearing account
with the State Bank of Pakistan or National Bank of Pakistan to be called
“Companies Unclaimed Instruments and Dividend and Insurance Benefits and
Investors Education Account” as may be notified by the concerned Minister-in-
Charge of the Federal Government and shall be deemed to be part of public
accounts and interest / profit accumulated thereon shall be credited on quarterly
basis to the Fund established under section 245 of this Act.

(4) Any person claiming to be entitled to any money paid into
“Companies Unclaimed Instruments and Dividend and Insurance Benefits and

Investors Education Account” may in pursuance of this section apply to the
Commission in such manner along with such documents as may be specified for
payment thereof, and the Commission after necessary verification from the
company concerned forward to the bank as notified under sub-section (3) to make
the payment to entitled p erson of the sum equivalent to his unclaimed or unpaid
dividend or amount of proceeds:

Provided that the payment to the claimant shall be made within a period of
thirty days from the date of verification by the company.

(5) A person shall be entitled to receive the shares or modaraba
certificates or any other instrument as delivered to the Commission by the company,
making a claim under this Act before the sale of such unclaimed shares or
modaraba certificates or the instrument, is effected by the Commission.
(6) A person making a claim under this section shall be entitled to the
proceeds of the sale of the shares or modaraba certificates or the instrument less
any deduction for expenses of sale.
(7) Payment to the claimant pursuant to sub -section (4) a nd a receipt
given by the bank in this respect shall be a good discharge to the Commission and
the bank.

(8) Where any dispute regarding unclaimed shares, modaraba
certificates, the instrument or dividend arises or is pending adjudication before the
competent authority or Court, the Commission shall process the claim in
accordance with the decision of such authority or Court.

(9) No claim whatsoever shall be entertained after the period of ten
years from the credit of any amount to the account of the Federal Government to
be maintained under this section.

(10) Every company within thirty days of the close of each financial year
shall submit to the Commission a return of all unclaimed shares, modaraba
certificates, the instruments or dividend in its b ooks in the manner as may be
specified by the Commission.

(11) Whoever contravenes the provisions of this section shall be
punishable with a penalty of level 3 on the standard scale.
(12) The account to be maintained under sub -section (3) shall be
available on the direction of Minister-in-Charge to serve as a collateral in order to
facilitate the provision of credit facility to the clearing house to address any
systemic risk in the capital market:
Provided that powers under this sub-section shall be exercised only in case
where in opinion of the Commission the resources of the clearing house are or likely
to be insufficient for timely settlement of trades executed at the securities and future
exchanges.