SECP chairman''s appointment challenged

The Supreme Court (SC) on Tuesday issued notices to the Chairman of Securities and Exchange Commission of Pakistan (SECP) and its four other wings to appear before the court on August 26. A two-member bench, headed by Chief Justice Iftikhar Muhammad Chaudhry, issued the notices while hearing a constitutional petition filed by Muhammad Ashraf Tiwana through Advocate Supreme Court Afnan Karim Kundi under Article 184 (3) of the Constitution of Pakistan.
Federation, through Secretary Finance Division, Ministry of Finance, SECP through its Chairman, Chairman Securities and Exchange Policy Board (SEPB) who is Secretary Finance Division, Muhammad Ali Ghulam Muhammad Chairman SECP, Tahir Mehmood Commissioner (Company Law Division) SECP and Bushra Aslam SECP''s Director Human Resource Department have been made respondents in the petition. The petitioner contended that appointment of SECP Chairman Muhammad Ali Ghulam Muhammad was in sheer violation of law, equity, justice, fairness, public policy and ultra vires of the law, Constitution and principles of natural justice.
The petitioner pleaded that appointment of those individuals as Commissioner or as SECP Chairman who were or have been members of stock and commodity exchanges, brokers, directors and/or shareholders of brokerage companies is against the law. The petitioner also requested to strike down some clauses of the SECP Act included sub-section (5) of Section 5 of the SECP Act as it was being ultra vires of Articles 73 and 75 of the Constitution of Pakistan.
Tiwana contended that Federal government be directed to introduce necessary amendments in the existing SECP Act as well as the new SECP Bill pending in the Parliament to prohibit the appointment of individuals with conflict of interests as Commissioners and Chairman of SECP in future whereas also ensure the avoidance of Regulatory Capture of SECP in line with best international practices. The petitioner further requested to strike down those sub clauses from SECP Services Rules which he claimed were ultra vires of Articles 4, 9, 10A, 14,18 and 25 of the Constitution as well as in contravention of Section 23 of the Contract Act 1872 and Section 24-A of the General Clauses Act.
It was also mentioned in the petition that SECP and Secretary Finance Division, who is the Chairman SEPB, be directed to ensure that SECP Service Rules are appropriately amended to afford its employees security of tenure and the benefit of procedural due process as required by the Constitution and principles of natural justice.
The petitioner prayed that Chairman of SECP Ali and Chairman of SEPB decision to abolish the Law Division of SECP be declared illegal for being mala fide against public interests and for violating Section 21 of the SECP Act. The Court adjourned the hearing for August 26.