Act/Law wise: Judgment of Supreme Court of Bangladesh

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Societies Registration Act [XXI of 1860]
Section/Order/Article/Rule/Regulation Head Note
Sections 2 and 10

A society registered under the Societies Registration Act is to be guided by the Act and its own memorandum of association. While registering the society, the Registrar of Joint Stock Companies did not find anything wrong with the memorandum of association or any of its articles to be against the Act. A charitable society can invest unspent money for getting more money to be spent in charity, as there is no bar in the Act and when its memorandum of association has authorized the society to invest its money not immediately required. (Per Mahmudul Amin Choudhury, CJ)
The investment of BRAC of its money not immediately required in BRAC Bank Ltd. is not an activity as envisaged in section 20. It is an investment under its memorandum of association in order to augment its resources for more efficiently achieving the objects for which it was incorporated. So, no amendment of section 20 is necessary. (Per Mainur Reza Chowdhury. J)
BRAC has been registered under the Act with the object to engage itself in charitable purposes and social welfare activities strictly on non-profit basis. By its investment in BRAC Bank, BRAC has gone for purely commercial activities, which is not permitted by its memorandum. In the event of bankruptcy of BRAC Bank the charity money would be lost if not totally but substantially, and the memorandum of BRAC does not contemplate investment of its assets or money where the loss of such investment is probable. Unless an amendment is made to the Act, it is not permissible for societies to go for commercial undertaking. (per Md. Ruhul Amin, J, dissenting)
BRAC v. Professor Mozaffar Ahmed and others, 22 BLD (AD) 41. ....View Full Judgment

Section 20

Charitable society can invest its unspent money for getting more money to be spent in charity and when there is absolutely no bar under the Societies Registration Act and when the Memorandum of Association of a society has authorised the same to invest their money not immediately required the same may be invested. BRAC and others vs Professor Mozaffar Ahmed and others 54 DLR (AD) 36. ....View Full Judgment