Dear Afsha, students who have had Urdu as a language in their highest qualification are given preference in admission. That doesn't mean that those students who dont have Urdu as their language aren't given admission. Lets say for example you and I are elible for applying for BUMS and there is one seat left. You have had Urdu as a language and I dont. If there is a tie in everything else between you and me, because you have had Urdu as your Language in 10+2, you are given preference over me for that seat. Or lets say when the merit list is being prepared, you are given a better ranking than me. 

Yes,Urdu is compulsory for applying in BUMS. Students must read urdu upto 10th class. As the entrance tests comprises of 2 papers, Paper 1 of Physics, chemistry and maths and paper 2 of Urdu and General knowledge. So it is compulsory for a student to know urdu so that they can qualify the entrance exams easily.