The Displaced Persons (Compensation and Rehabilitation) Act,1954
Section 6. Relief to certain banking companies
1) Where a debt due to a banking company is secured by a mortgage, charge or lien on any immovable property belonging to a displaced person in West Pakistan in respect of which compensation is payable under this Act and such mortgage, charge or lien was subsisting or the date when the claim of the banking company was registered under the Displaced Persons (Claims) Act,1950 (XLIV of 1950), the banking company shall be entitled to relief in accordance with the provisions of this Section.
(2) Where the displaced person is entitled to receive compensation in respect of any such property as is referred to in sub-section (1), the banking company shall be entitled: –
(a) if the compensation to the displaced person in respect of such property is payable in cash, to receive such amount as bears to the total debt, the same proportion as the compensation payable to the displaced person bears to the value of the verified claims of the displaced person in respect of such property;
(b) if the compensation to the displaced person is payable in the form of transfer of any property from the compensation pool, then, subject to a prior charge under sub-section (3) Section 20 to a second charge on such property for the amount which would have been payable to the banking company under clause (a) if the displaced person had been paid compensation in cash;
(c) if the compensation to the displaced person is payable in any other form, to such relief as the Settlement Officer, having regard to the principle specified in clause (a) or (b), may determine.
(3) For the purpose of this Section,–
(a) the expression ” banking company means any of the displaced banks specified in the Schedule and includes any other banking company which before the fifteenth day of August,1947 carried on the business of banking, whether wholly or partially in any area now forming part of West Pakistan and which the Central Government may, having regard to the dislocation of such business on account of the partition of the country, by notification in the Official Gazette, specify in this behalf;
(b) the expression ” total debt means,–
(i)where the banking company has preferred a claim under the Displaced Persons (Claims) Act,1950 (XLV of 1950) and the claim has been verified, the amount of the verified claim, subject to such adjustment as the Settlement Officer, having regard to the provisions of the Displaced Persons (Debts Adjustment) Act,1951 (LXX of 1951) applicable to secured debts, may make;
(ii) where the banking company has preferred such claim but the claim has not been verified, such amount as the Settlement Officer, having regard to the provisions of the Displaced Persons (Debts Adjustment) Act,1951 (LXX of 1951) applicable to secured debts, may determine.