RE: Legal Opinion regarding opening of bank account by Company 1 Employee’s Provident Fund Trust.
We refer to your letter dated 31 July 2007 on the same subject.
The following documents are furnished to us:
- Company 1 Employee’s Provident Fund Trust Deed (“Trust Deed”),
- Company 1 Employee’s Provident Fund Trust Rules (“Trust Rules”),
- Resolution of the Board of Trustees dated 26 June 2007, and
- Letter of approval from NBR no- 6/asa-13/2007-08/163 dated 19/7/07 (“NBR Approval Letter”).
It appears that Company 1 Employee’s Provident Fund Trust (“the Provident Fund”) wants to open a savings account with BANK 1 under the name and style “Company 1 Employee’s Provident Fund”.
In such situation we are requested to review the Provident Fund Trust Deed, Rules and the letter from NBR and to give our opinion regarding whether the Provident Fund can open such accounts with BANK 1.
Clause 15 of the Trust Deed states as follows:
(a) The Trustees shall from time to time pay into the account sanctioned by the Trustees all monies received for credit to the account of the Fund, which account is to be styled “Company 1’ Provident Fund”,
(b) The monies so deposited shall be dealt with only in accordance with the rules. The Trustees shall be at liberty to keep a reasonable amount of petty cash for expenses. Any withdrawal from such bank accounts shall be by cheque signed jointly by any two (2) trustees, as designated by the Chairman of the Fund.”
Pursuant to the Trust Deed, the Trustees of the Provident Fund can open a bank chequing account for the Fund in the name and style of “Company 1’ Provident Fund” and the funds shall be operated in accordance to the Rules. It is also stipulated that withdrawals from such account shall be by cheques signed jointly by any two (2) trustees, as designated by the Chairman of the Provident Fund.
From the Resolution of the Board of Trustees dated 26 June 2007, we find that resolutions 3 and 4 have been passed by the Board of Trustees authorizing Mr. Y, General Manager and Mr. x, Finance Manager (both Trustees) to open and maintain a savings account in the name and style of “Company 1” with BANK 1 and to be the joint signatories of such bank account. This resolution corresponds with the provisions contained in the Trust Deed.
The Provident Fund has already applied to the NBR for recognition pursuant to the Income Tax Ordinance 1984 and NBR has given approval vide the NBR Letter. As such it is our legal opinion that, BANK 1 may allow the designated Trustees to open a savings bank account for the Provident Fund.
If you have any further query, please do not hesitate to contact the undersigned.
For: “The Lawyers & Jurists”