Updated: Monday April 25, 2016/AlEthnien Rajab 18, 1437/Somavara Vaisakha 05, 1938, at 01:14:00 AM
The Development of Industries (Federal Control) Act, 1972
1ACT No. XVI OF 1972
[24th September, 1972]
An Act to provide for certain matters relating to the development of industries under Federal control.
WHEREAS it is expedient to provide for certain matters relating to the development of industries under Federal control;
It is hereby enacted as follows:---
1. Short title, extent and commencement.-(1) This Act may be called the Development of Industries (Federal Control) Act, 1972.
(2) It extends to the whole
(3) It shall come into force at once.
2. Definitions. In this act, unless there is anything repugnant in the subject or context,---
(a) ”Board” means the Board of Industrial Management constituted under section 5;
(b) ”Chairman” means the Chairman of the Board;
(c) ”establishment” means an establishment within the meaning of the Order in respect of which a ManagÂing Director has been or is appointed under Article 4 thereof;
(d) ”Fund” means the Board of Industrial Management Fund constituted under section 8;
(e) ”Managing Director” means a Managing Director appointed under the Order;
(f) ”member” means a member of the Board; and
(g) ”Order” means the Economic Reforms Order, 1972 (P.O. No. 1 of 1972).
3. Declaration. It is hereby declared that development under Federal control of the industries specified in the Schedule is expedient in the public interest.
4. Act to override other laws. The provisions of this Act shall be in addition to those of the Order and shall have effect notwithstanding anything contained in the Companies Act, 1913 (VII of 1913), or any other law for the time being in force or in any agreement, contract or memorandum or articles of association of a company.
1For Statement of Objects and Reasons, see Gaz.,
of P., 1972, Ext.,
5. Constitution of Board.—(1) The Federal Government shall constitute1 a Board of Industrial Management which shall consist of a Chairman and such number of members, not exceeding nine, as the Federal Government may appoint.
(2) The Board shall be a body corporate by the name of the Board of Industrial Management having perpetual succession and a common seal, with power to acquire and hold property, and shall by the said name sue and be sued.
(3) The members and the Chairman shall hold office during the pleasure of the Federal Government on such terms and conditions as it may determine.
6. Functions of the Board.—(1) The functions of the Board shall be to ensure that the establishments are managed efficiently and in accordance with sound business principles and, in the performance of that function, the Board may, from time to time,---
(a) exercise such of the powers of a Managing Director under the Order, and issue such directions to him, as it may consider necessary;
(b) require a Managing Director to furnish it with such information relating to the affairs of the establishment in respect of which he is the Managing Director as the Board may require;2
(c) remove from office an auditor of an establishment and appoint another person to hold that office, or appoint an auditor in addition to the auditor of an establishment, for such period and on such remuneration payable by the establishment as the Board may determine 3[; and]
4[(d) remove from office any of the trustees of a provident Fund Trust or Gratuity Trust constituted in an establishment and appoint any other person to hold that office for such period and on such terms and conditions as the Board may determine.]
(2) The exercise by the Board under sub-section (1) of the powers of a Managing Director shall have effect as if it were the exercise of those powers by the Managing Director himself.
(3) It shall be the duty of a Managing director to comply with all directions issued to him by the Board relating to the management of the establishment in respect of which he is the Managing Director and to furnish the Board with the information required by it.
7. Directions by Federal Government etc.—(1) The Federal Government may, by notification in the official Gazette, direct that all or any of its powers under the Order shall, in such circumstances and subject to such conditions, if any, as may be specified in the notification, be exercisable also by the Board.
1For notification constituting the Board, vide S.R.O. No. 816(I)/72, dated 30-9-1972, see Gaz. of P. 1972, Ext., Pt. II, p. 892.”
2The word “and” omitted by the Development of Industries (Federal Control) (Amd”t.) Act, 1974 (37 of i974), s. 2.
3Subs. ibid., for full-stop.
4New clause (d) added ibid..
(2) The Federal Government may from time to time issue such directions to and call for such information or report from, the board as it may deem necessary.
8. The Fund.—(1) There shall be constituted a fund to be called the Board of Industrial Management Fund to which shall be credited all sums received by the Board under sub-section (2) and out of which shall be defrayed all expenditure incurred by the Board, including expenditure on the emoluments of the Chairman and members and the officers, servants, experts and consultants of the Board.
(2) The Managing Director in respect of every establishment shall make to the Board each year such payment to enable it to defray its expenses as the Board may, with the prior approval of the Federal Government in writing demand of him:
Provided that the aggregate amount of payments so demanded of the Managing directors in any year shall not exceed by more than ten per cent the amount of the estimated expenditure of the Board in that year.
19. Officers and servants, etc.—(1) The Board may from time to time appoint such officers, servants, experts and consultants as it considers necessary for the efficient performance of its functions, on such terms and conditions as it may deem fit.
(2) The Board may appoint one or more committees of the Board with such composition and functions as it may determine.
10. Adoption of balance sheet. In the case of an establishment ordered or controlled by a company, the general meeting of the company before which a balance-sheet is laid shall not, if the Federal Government by order in writing so directs, have the authority to refuse to adopt the balance-sheet, but nothing in this section shall be construed to' prevent any shareholder from expressing his views on the financial affairs of the establishment and a record of the proceedings of such meeting shall be forwarded to the Federal Government not later than fifteen days of the meeting.
11. Indemnity and bar of jurisdiction.—(1) No suit, prosecution or other legal proceeding shall lie against the Federal Government or the Board or any other person for anything in good faith done or intended to be done under this Act.
(2) No court shall call in question, or permit to be called in question, anything done or any action taken under this Act.
12. Power to make rules.—(1) The Board may, with the prior approval of the Federal Government, make such2rules as appear to it to be necessary for carrying out the purposes of this Act.
1For the Board of Industrial Employees'
Gratuity Rules, 1972 vide S.R.O. No. 364(I)/73, dated 16-3-73, see Gaz. of P.,
For the Board of Industrial Management Employee's Medical Rules, 1972, vide S.R.O. No. 365(I)/73, dated 16-3-98 see Gaz., of P., 1973, (Pt. II, pp. 432,435.)
For the Board of Industrial Management Employee's Provident Fund
Rules, 1973 vide S.R.O. No. 811 (I)/73, dated 6-6-73, see Gaz., of P.. 1973.
2For the Board of Industrial Management Fund Rules, 1973, vide S.R.O. No. 330(I)/73 dated 13-3-73, see Gaz., of P., 1973 Ext., (Islamabad) Pt., II, pp. 407—409.
(2) In particular and without prejudice to the generality of the foregoing power, such rules may provide for the manner of payment and collection of the payments required to be made by the Managing Directors under sub-section (2) of section 8.
13. Delegation. The Board may, with the previous approval in writing of the Federal Government, direct that all or any of its powers under this Act shall, in such circumstances and subject to such conditions, if any, as may be specified by the Board, be exercisable also by a member or a committee appointed under sub-section (2) of section 9.
14. Removal of doubts. For the removal of doubts it is hereby declared that the powers and functions of the Federal Government under the Order shall be, and shall be deemed as from the 21st day of April, 1972, to have been, the powers of the Federal Government and the provisions of the Order shall have effect accordingly.
1[14A. Validation. All powers exercised and all functions performed by the Board of Industrial Management constituted under the Government of Pakistan, Ministry of Finance, Economic Affairs and Development, Notification No. 2649/72, dated the 23rd February, 1972, at any time before the commencement of this Act shall be deemed to have been validly exercised and performed as if this Act were in force on the day on which the powers or functions were so exercised or performed.].
15. [Repeal of Ordinance XXXVI of 1972.] Omitted by the Federal Laws (Revision and Declaration) Ordinance 1981, (XXVII of l981),s.3 and Sch.,II.
[See section 3]
1. Iron and steel industries.
2. Basic metal industries.
3. Heavy engineering industries.
4. Heavy electrical industries.
5. Assembly and manufacture of motor vehicles.
6. Tractor plants, assembly and manufacture.
7. Heavy and basic chemicals.
8. Petro-chemical industries.
9. Cement industry.
10. Public utilities, that is to say,—
generation, transmission and distribution;
(b) Gas; and
(c) Oil Refineries.
1New section 14A ins. by the Development of Industries (Federal Control) :Amdl.) Act. 1973 (34 of 1973). s.2.