This matter before us arises from a revision petition filed under section 484 of the Companies Ordinance, 1984 (the "Ordinance") by the appellants against the order dated August 22, 2002 (the "impugned order") made by the Executive Director (Enforcement and Monitoring):--
1. The brief facts of the case are that a notice dated July 17, 2002 was issued by the Enforcement and Monitoring Division of SEC to appellant No.1, its chief executive officer and directors to show cause as to why fine may not be imposed for inter alia, contravention of the provisions of subsection (2) of section 205 of the Ordinance for incorrectly describing one Mr. Naveed A. Wahid as a director of the Company. Mr. Naveed A. Wahid had earlier approached the Commission with a complaint that the Company was still describing him as a director when he had resigned from his office.
2. An opportunity of personal hearing was given to the above named by the Executive Director on August 19, 2002, when they appeared and pleaded their case. The Executive Director not being satisfied with their averments, imposed a cumulative penalty of Rs.75,750 (Rupees seventy-five thousand seven hundred and fifty only) under subsection (5) of section 205 of the Companies Ordinance, 1984 vide the impugned order on appellant No.1, its Chief Executive Mr. Tahir Hassan and Directors namely.
Mr. Muhammad Nasimuddin Mirza, Mr. Obaidullah Siddiqui, Mr. Shahid Rehman, Mr. Yaqoob Admaney, Mr. Rashidullah Yaqoob and Mr. Muhammad Tahid Siddiqui for their failure to file the returns regarding change of director.
3. The present revision was filed by the counsel Mr. Tariq M. Khokhar and Mr. M. Aslam Arian on behalf of appellants 1 to 5 mentioned above as well as Mr. Shahid Rehman. The revision was fixed for hearing before the Appellate Bench on October 23, 2002, however the appellant's counsel showed their inability to appear on the said date. The case was adjourned therefore and re-fixed for November 11, 2002. No one appeared on the said date either and the case was therefore dismissed by the Appellate Bench for non-prosecution. Later, the counsel moved an application for restoration of the case, which was accepted by the Bench and the case was fixed for January 15, 2003. On the said date of hearing, it was noted by the Bench that the power of attorney filed by the counsel did not authorize them to appear and plead the case on behalf of the CEO and the directors of the Company. The counsel asked for time from the Bench for producing the relevant power of attorney, which was granted to them. The case was fixed for February 25, 2003. However, the counsel failed to produce the power of attorney from all the appellants contending that some of them were visiting abroad. The Bench granted the counsel, 21 days to either produce the power of attorney or withdraw the revision of the directors who had not authorized them properly. The date of hearing was fixed for March 20, 2003 when the counsel produced the power of attorney . from the appellants named above and withdrew the revision of Mr. Shahid Rehman. This order will therefore dispose of the revision filed by the counsel on behalf of the appellants named above.
4. At the outset of their arguments the counsel asserted that the Executive Director did not have the jurisdiction to pass the impugned order. They contended that the powers and functions of the Commission under different laws have been delegated to the Executive Directors of the Commission under S.R.O. 323(1)/2002 dated June 14, 2002. The said S.R.O., they argued did not delegate the powers under section 205 of the Ordinance to the Executive Director (Enforcement and Monitoring). They further argued that pursuant to section 476(1)(a), the power to impose fine under section 205 was exercisable by the officer incharge of registration office in which the company was registered.
5. Mr. Mubasher Saeed, Joint Director appearing on behalf of the Executive Director (Enforcement and Monitoring) contended that the impugned order passed by the Executive Director does not suffer from a jurisdictional error. He asserted that although S.R.O. 323(1)/2002 dated June 14, 2002 does not specifically mention section 205 in para.3, however the S.R.O. lays down that in addition to the powers and functions of the Commission specifically delegated under the S.R.O., the Executive Director concerned shall have the authority to exercise all adjudicatory powers under the relevant laws and to take cognizance of the offences. In his view, the Executive Director was within his authority to exercise the power and impose the fine upon i he appellants.
6. In addition to the above arguments on l.he jurisdictional issue, both parties presented detailed arguments on the merits of the case. We have heard both the parties and considered their arguments and intend to dispose of this revision petition on the issue of jurisdiction alone. In our opinion the appellants are right to argue that the Executive Director has not been delegated the power to impose fine for violation of section 205. We have perused S.R.O.323(I)/2002 dated June 14, 2002 and it is clear that section 205 is not included in para 3 which specifies the relevant sections of the laws and nature of powers and functions exercisable by Executive Director (Enforcement and Monitoring).
7. We do find some weight in the argument that the Executive Director can exercise the power to impose fine under subsection (5) of section 205 pursuant to clause (ii) of the S.R.O., which lays down that: "In addition to above, the following powers and functions of the Commission shall also be delegated to the Executive Director concerned, namely:- To exercise all adjudicatory powers under the relevant laws and to take cognizance of the offences."
However, subsection (5) of section 205 is to be read with subsection (1) of section 476 of the Ordinance while imposing the fine provided in subsection (5) of section 205. Subsection (1) of section 476 stipulates which officer/entity shall adjudge and impose the fine for any offence or default in complying with any provision of the Ordinance, where a fine other than fine in addition to or in lieu of imprisonment is provided for such offence or default. Under section 476(1)(a) where any contravention or default in complying with any provision of the Ordinance where the maximum fine provided is less than Rs.5,000 and the daily fine is less than Rs.200, the power to impose fine is to be exercised by the officer incharge of the registration office where the company is registered.
As the fine provided in subsection (5) of section 205 is Rs.500 and the daily fine is Rs.50, therefore the power to impose this fine lies with officer incharge of the registration office where the Company is registered and not the Executive Director (Enforcement and Monitoring).
8. Mr. Mubasher argued that pursuant to subsection (2) of section 476 the Commission may in writing empower any officer to exercise the powers conferred by subsection (1) of section 476 either to the exclusion of or concurrently with the officers mentioned in subsection (1) of section
476. He contended that this provision should be read with clause (ii) of the S.R.O. produced above, meaning thereby that the Commission had in fact delegated the power to the Executive Director to impose fine which falls in the category of section 476(1)(a) to be exercised concurrently with the officer incharge of the registration office. We do not agree with this contention as clause (iii) of the said S.R.O. delegates to the Executive Director (Enforcement and Monitoring) only the power of the Commission under section 476(1)(c) of the Ordinance. In presence of specific delegation of the power, which falls in the bracket of section 476(1)(c) it cannot be presumed that the said S.R.O. also indirectly delegates the power, which falls in the bracket of section 476(1)(a). One of the principles of statutory interpretation is "Expressio Unius Est Exclusio Alterius" meaning that the specific expression of one thing implies the exclusion of the other.
In light of the submissions of the parties, the documents on record and the above findings we accept this revision petition and set aside the fine imposed on the appellants vide the order dated August 22, 2002 passed by Executive Director (Enforcement and Monitoring).