IN THE HIGH COURT OF SINDH AT KARACHI
BEFORE:
Mr. Justice Muhammad Shafi Siddiqui
Miscellaneous Appeal No. 47 of 2017
M/s Labbaik (Pvt.) Limited
Versus
Pakistan Electronic Media Regulatory Authority & others
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Date of Hearing: |
02.03.2018, 26.03.2018, 13.04.2018, 23.04.2018 and 22.05.2018
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Appellant: |
Through M/s Anwar Mansoor Khan, Shahab Sarki, Imdad Ali Saheto, Muhammad Muaaz Saqib, Muhammad Ali Talpur and Muhammad Zaheer Advocates.
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Respondents No.1 & 2: |
Through Mr. Zahid F. Ebrahim along with Ms. Nazia Hinjrah Advocates.
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Respondent No.3: |
Through Mr. Salman Talibuddin, Addl. Attorney General along with Mr. Muhammad Naeem Khan, Assistant Attorney General.
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Applicants/interveners of CMA No. 11539 to 11542 of 2017:
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Through Mr. Jawed Haleem Advocate |
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Applicant/intervener of CMA No.11552 of 2017:
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Through Mr. Saim Hashmi along with Mr. Jam Asif Mehmood Advocates. |
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Muhammad Shafi Siddiqui, J.- This Statutory Appeal under section 30(A) of Pakistan Electronic Media Regulatory Authority Ordinance 2002 impugns an order dated 02.05.2017 passed by respondent No.1, hereinafter called Authority, whereby broadcasting license of the appellant was cancelled on the ground of respondent No.3’s letter of regret in reissuing security clearance.
2. Brief facts for the purpose of deciding this appeal are that the appellant being a private limited entity were connected in the business of satellite television and broadcasting. Appellants were licensed to operate satellite TV channels and later introduced channels identification as “BOL NEWS” and “PAK NEWS” and consequently all matters related to the channels including but not limited to broadcasting, marketing and other affairs were dealt with by the appellant.
3. The license was granted originally to one Labbaik (Pvt.) Limited (appellant) on 27.12.2006 having different set of directors. The change of shareholding in appellant company took place on 30.10.2012 perhaps in the record of Security & Exchange initially without approval of PEMRA. The appellant then moved an application to PEMRA seeking permission to induct new directors on 04.03.2013. On 21.03.2013 PEMRA sent the names of new directors for security clearance. On 25.03.2013 Ministry of Interior issued security clearance followed by PEMRA’s approval regarding induction of new directors on 26.03.2013.
4. The first issue cropped up when the Ministry of Interior withdrew security clearance on 04.07.2013 for the first time which resulted in filing of CP No.D-2867 of 2013 by appellant challenging the withdrawal of security clearance. The issues were dealt with and an authoritative judgment was passed by Division Bench of this Court in the aforesaid CP on 03.07.2015 and “Ministry of Interior” was directed to take steps for finalizing security clearance one way or the other followed by letter of PEMRA on 24.07.2015.
5. On 23.09.2015 PEMRA suspended license of appellant. The suspension order of PEMRA dated 23.09.2015 was then challenged in M.A. No.58 of 2015 before this Court which suspension letter was subsequently withdrawn by PEMRA on 19.10.2016.
6. The show-cause notice was then issued on 23.12.2016. The Hon’ble Supreme Court directed the appellant to reply to PEMRA’s show-cause notice and then PEMRA to pass appropriate orders. The appellant filed their reply to show-cause notice and it was claimed that personal hearing was given by PEMRA. The Council of Complaints (respondent No.2) summoned Labbaik on 23.03.2017.
7. It is claimed by the appellant that without prejudice to their rights as to the powers and jurisdiction of Council of Complaints, they appeared and filed their reply however PEMRA passed the impugned order and it is claimed that they (appellant) were not heard by PEMRA on this point of referring matter to Council of Complaints at the time hearing and also when the Council of Complaints recommended its decision to PEMRA.
8. Initially this Court set aside the impugned order dated 02.05.2017 (impugned order) on 17.05.2017 in this appeal, however the Hon’ble Supreme Court in Civil Petition No.1689 of 2017 remanded the case back to this Court for decision in accordance with law on 28.11.2017. In the meantime on 10.06.2017 appellant also filed petition bearing No.D-4087 of 2017 before Division Bench of this Court challenging letter of Ministry of Interior dated 30.03.2016 (letter of regret) and obtained order of its suspension.
9. Learned counsel appearing for the appellant argued that it is the case of the appellant that during pendency of earlier litigation, the Additional Attorney General showed a letter of ISI to the Court in which it was stated that ISI did not issue clearance letter to new set of directors and hence Ministry of Interior was directed to process security clearance as per practice in vogue and once issue of security clearance is finalized either way, the authority would proceed in accordance with law. It is claimed that ISI then gave security clearance on fulfillment and compliance of all legal and codel formalities, which letter is available as Annexure ‘X’ dated 15.03.2016 to the petition, which security clearance letter was mandated by this Court in CP No.D-2867 of 2013, as argued.
10. Learned counsel submitted that despite above process being completed in accordance with the judgment and as stated above, a show-cause notice was followed by decision on 16.09.2015 communicated on 23.09.2015 which was challenged in M.A. No.58 of 2015. It is claimed that since the terms of the show-cause were not clear, it was presumed, as alleged, that the subject matter was not related to security clearance. The suspension order in Misc. Appeal No.58 of 2015 was then challenged before Hon’ble Supreme Court who directed the appellant to submit their reply in response to show-cause notice dated 23.12.2016 directly to respondent No.1.
11. It was however contended by the learned counsel for the appellant that directions pertaining to security clearance were given by the Hon’ble Supreme Court on technical grounds that reply should be filed before the authority. It is claimed that they (appellants) were surprised to note that the matter of security clearance was proceeded before respondent No.1 on 08.03.2017 when they appeared in response to the aforesaid show-cause notice. This, they (appellant) claimed to be in violation of the order of the Hon’ble Supreme Court dated 08.02.2017. Respondent No.2 (Council of Complaints), in pursuance of the aforesaid show-cause notice issued summons which is also in violation of order of the Hon’ble Supreme Court dated 08.02.2017 as it talks about the law and appropriate order to be passed by respondent No.1 (PEMRA), relevant part of order is reproduced in paragraph 25 ahead.
12. It is argued by learned counsel for the appellant that issue pertaining to security clearance of newly inducted directors could only be dealt with by the Authority and not by Council of Complaints and as there was no complaint, the Council of Complaints had no jurisdiction to hear the matter or to issue summons. Despite these objections and without prejudice to their right the appellant appeared and assisted the Council of Complaints and informed them about their jurisdiction who relied upon Section 30(1)(b) of Ordinance 2002 for taking cognizance of the matter.
13. It was argued that in terms of Section 30(1)(b) it is only when PEMRA reached to a lawful conclusion of revocation of license, on account of contravention of provisions of Ordinance, they (Council of Complaints) may intervene but such situation never reached and additionally no points were framed for referring the matter to Council of Complaints by PEMRA covering the issue of revocation of license. They (respondents), thus claimed to have acted beyond their jurisdiction insofar as Council of Complaints’ role is concerned.
14. It is further argued that Section 26 of Ordinance 2002 also does not enable them (Council of Complaints) to intervene on its own as it relates to receiving and reviewing the complaints of persons and organizations, which is not the case here. It is claimed that despite this objection, respondent No.2 heard the matter and gave the recommendation to respondent No.1. Respondent No.1 thus without hearing the appellant passed the impugned order following recommendations of the respondent No.2 whereby the license of the appellant was revoked.
15. It is the case of the appellant that in fact in the original litigation it was only the security clearance with reference to ISI which was required as the Addl. Attorney General showed a letter of ISI and stated that it did not issue clearance letter to the new set of directors, therefore, the formality of security clearance was not completed. The security clearance of ISI was then issued vide letter dated 15.03.2016 and the matter came to an end. The above security clearance document was taken on record. It is thus argued that when this security clearance from one of the prime agencies was taken on record as mandated on 10.10.2016 there was no other security agency requiring clearance for induction of newly inducted directors.
16. The regret letter which is now a bone of contention is dated 30.03.2016 and this not only showed to have been issued two weeks later to the letter of clearance from ISI (15.03.2016) which was annexed with CP No.D-2867 of 2013 and taken on record but also prior to order dated 10.10.2016 in M.A. No.58 of 2015 when security clearance was mandated in the aforesaid C.P. NO.D-2867 of 2013 and this letter was not disclosed/revealed. This prior letter dated 30.03.2016 of Ministry of Interior is thus claimed to be a fictitious and managed one. This letter of 30.03.2016 for the first time disclosed on 06.05.2017 before Hon’ble Supreme Court by PEMRA/ authority. It is claimed to be a collusive exercise of PEMRA in association with appellant’s competitors. This letter was allegedly issued during pendency of M.A. No.58 of 2015 and was allegedly kept secret/hidden, wherein order of 23.09.2015 was challenged. On 19.10.2016 PEMRA withdrew its decision/ notification dated 23.09.2015 whereby PEMRA suspended licenses of the appellant though presumably they were in possession of letter dated 30.03.2016 of Ministry of Interior regretting the security clearance of the appellant’s directors.
17. Counsel for the appellant has also attacked the genuineness of letter dated 30.03.2016 besides being unconstitutional and unreasoned in terms of Section 24-A of General Clauses Act. It is claimed that such letter of Ministry of Interior dated 30.03.2016 is otherwise impugned and suspended in CP No.D-4087 of 2017 on 12.06.2017.
18. Mr. Salman Talibuddin, Addl. Attorney General appearing for respondent No.3 and Mr. Zahid F. Ebrahim, appearing for respondents No.1 and 2 have also argued the matter at length on merit of the appeal and have provided a history of the alleged directors newly inducted in the company as they were same who were allegedly involved in money laundering case of Axact (Pvt.) Limited.
19. It is argued that the question of security clearance could never be said to be set at rest once they got cleared, either erroneously or genuinely. It can always be triggered as and when information is received, which in this case triggered when the New York Times published an article on 17.05.2015 on fake degree associated with Axact (Pvt.) Limited. Learned counsel for respondents claimed that PEMRA could only act upon the issue relating to the security clearance which they did in terms of letter of regret of concerned Ministry but they cannot have their own opinion regarding security clearance which is mandated to the Ministry of Interior. Per learned counsel for respondents, they cannot question concerned Ministry as to why the security clearance was given or not given as it is not within their domain. The aggrieved party alone could have challenged such letter whereby the security clearance was regretted or otherwise which has already been done by the appellant by filing CP No.D-4087 of 2017 and got the letter suspended.
20. Insofar as issue of Council of Complaints is concerned it is argued that in terms of Section 30(b) since the licensee has “contravened” the provisions of Ordinance 2002, it triggered the office of the Council of Complaints to form their view for revocation of license, hence they prayed for dismissal of this appeal.
21. I have heard the learned counsel for the parties and perused the material available on record.
22. In this appeal CMA Nos.11539 to 11542 of 2017 and CMA No.11552 of 2017 under order I rule 10(2) CPC have also been filed by the interveners/applicants to be impleaded as being necessary and proper parties. I have heard the counsels appearing for them and before discussing the appeal I would first like to decide these interveners application.
23. Order I Rule 10(2) CPC enables the Court either on its own or upon an application, at any stage of the proceedings to delete an improperly joined party and similarly the name of any person who ought to have been joined whether as plaintiff or defendant or whose presence before the Court may be necessary in order to enable the Court to effectually and completely adjudicate upon and settle all questions involved in the suit, be added. If the mechanics of this provision, as claimed, is applied we ought to be certain that their presence before the Court is inevitable to enable the Court effectually and completely adjudicate upon and settle all questions involved in the proceedings. Throughout the proceedings ever since the Article was published in New York Times and proceedings initiated by PEMRA and its recommendation to the Council of Complaints these applicants who call themselves to be necessary and proper parties were never considered at all by Authority. Though it is being claimed seriously that some of the applicants/interveners, being competitors in the business of the appellant, have serious interest in airing the article that is being relied upon, however, for the purposes of these controversies I do not see any of these applicants to be within the frame of Order I Rule 10(2) CPC and the Court does not require their assistance at all for effectually and completely reached to a well-reasoned conclusion. The test is whether questions involved could be decided in absence of interveners and presence of PEMRA? My answer is, yes, it can be. In presence of PEMRA none of the applicants is deemed as necessary and proper party. Accordingly, these applications under order I rule 10 CPC are dismissed.
24. Now I would like to discuss the main appeal. The root cause of the present litigation is the show-cause notice of 23.12.2016 which is subsequent to the decision in CP No.D-2867 of 2013 dated 03.07.2015. The second recital of the show-cause notice is with reference to security clearance/credibility of track record of the directors of the company which was claimed to be mandatory in terms of Rule 7(d) read with Rule 9(5) of PEMRA Rules 2009. Surprisingly 30(1)(d) is not pleaded here. It is claimed that Ministry of Interior in pursuance of directions of the Hon’ble Court has regretted the security clearance of the four directors vide letter dated 30.03.2016.
25. A preliminary question arises as to why this letter was not referred in earlier litigation such as M.A. No.58 of 2015. PEMRA withdrew their suspension letter of 23.09.2015 on 19.10.2016 i.e. almost after seven months of receipt of the alleged letter from the Ministry of Interior dated 30.03.2016. It certainly raises eyebrows as to why this letter was not revealed promptly in proceedings of M.A. 58 of 2015, challenging order dated 16.09.2015 served on 23.09.2015 passed by PEMRA. Suspension order impugned in M.A. No.58 of 2015 was withdrawn being infructuous, as mentioned in the order of Hon’ble Supreme Court in Civil Petition No.173 of 2017 dated 08.02.2017. The relevant part of the order is reproduced:-
“ 4. The learned Counsel for Respondent No.1 concedes that orders dated 23.09.2016, 26.01.2017 and 27.01.2017 ought to have been challenged by the Respondent No.1, by filing separate Appeals and could not have been challenged through CMAs in a disposed of Appeal, which had become infructuous after 19.10.2016, when the Authority had withdrawn its order dated 16.09.2015, the subject matter of the Appeal.
5. We, in view of the fair stance taken by the learned Counsel for the Respondent No.1, hold as under:-
I. Miscellaneous Appeal No.58 of 2015 on withdrawal of the order dated 16.09.2015 has become infructuous. All the contempt applications made in the Miscellaneous Appeal by the respondent No.1 will not be pressed by the Respondent No.1 and would stand disposed of.
II. So far as the show cause notice issued on 23.12.2016 by the Authority is concerned, the Respondent No.1 is at liberty to submit reply to the Authority which on receipt of the reply will pass appropriate orders, after hearing the Respondent No.1 or his representative.
III. The order dated 26.01.2017 shall hold the field and the Respondent No.1 may file its reply before the Authority. Likewise, show cause notice dated 27.01.2017, issued by the Authority shall also be replied to by the Respondent No.1 and after hearing, the Authority shall pass appropriate orders.
IV. However, if either of the parties feels aggrieved by any of the orders passed by the Authority, it may, if so advised, prefer Appeal in terms of the Ordinance.”
26. The Hon’ble Supreme Court in response to the interim orders passed in M.A. 58 of 2015 left it to the discretion of M/s Labbaik to reply to PEMRA’s show-cause notice who then, expected to pass appropriate orders. Does it mean that the PEMRA has to do at its own? or do they require opinion/recommendation of the Council of Complaints? Such being questions, are answerable in this appeal. For that the relevant enabling provisions of PEMRA Ordinance 2002 are to be scrutinized.
27. The first and foremost is Section 26 that relates to Council of Complaints. The Federal Government was empowered to establish Council of Complaints at Islamabad and provincial capitals and also such other places as the Federal Government notify through a notification in official gazette. They were empowered to “receive and review” complaints made by persons or organizations from general public against “any aspect of a program” broadcasted or distributed by the stations established through a license issued by the Authority and render opinion on such complaints. This provision does not enable Council of Complaints to act in the present case, since it pertains to receiving and reviewing complaints of individuals and organizations and that too in respect of certain programs.
28. Now the other provision which was relied upon i.e. Section 30(1)(b) of the Ordinance 2002 is to be scrutinized. Entire Section 30 for the sake of convenience and so also Rules 7(d), (e) and 9(5) of Pakistan Electronic Media Regulatory Authority Rules, 2009 are reproduced as under:-
30. Power to vary conditions, suspend or revoke the licence.- (1) The Authority may revoke or suspend the licence of a broadcast media or distribution service by an order in writing on one or more of the following grounds, namely:-
(a) the licensee has failed to pay the licence fee, annual renewal fee or any other charges including fine, if any;
(b) the licensee has contravened any provision of this Ordinance or rules or regulations made thereunder:
Provided that in the case of revocation of a licence of a broadcast media an opinion to this effect shall also be obtained from the Council of Complaints;
(c) the licensee has failed to comply with any condition of the licence; and
(d) where the licensee is a company, and its shareholders have transferred a majority of the shares in the issued or paid up capital of the company or if control of the company is otherwise transferred to persons not being the original shareholders of the company at the time of grant of licence, without written permission of the Authority.
(2) The Authority may vary any of the terms and conditions of the licence where it deems that such variation is in the public interest.
(3) Except for reason of necessity in the public interest a licence shall not be varied, suspended or revoked under sub-section (1) or sub-section (2) unless the licensee has been given reasonable notice to show cause and a personal hearing.”
Rules 7(d), (e) and 9(5) of PEMRA Rules, 2009
“7. Criteria for evaluation licence application.- Application for the grant of a licence shall, in the first instance, be short listed by adopting the following criteria, namely:--
…..
(d) credibility and track record;
(e) majority shareholding and management control shall vest in Pakistani nationals;
9. Grant of licence.- (1)….
(5) The Authority shall, within one hundred days from the date of its receipt, take decision on the application for grant of a licence subject to clearance from the Ministry of Interior and frequency allocation by FAB in relevant cases.”
29. After issuance of show-cause notice dated 23.12.2016 and initial hearing, the matter was referred to the Council of Complaints for an opinion. Section 30 of PEMRA Ordinance 2002 further encompasses the domain of Council of Complaints and to me it is not absolute but qualified. Section 30 relates to powers to vary conditions, suspend or revoke the license of the broadcasting media or distribution service provided the licensee either fail to pay the license fee/annual renewal fee or any other charges including fine and the licensee has contravened any provisions of this Ordinance or rules and regulations made thereunder. Perhaps Section 30(b) most likely was invoked in the present proceedings by PEMRA for referring the matter to them. The Council of Complaints could only be approached for their opinion in case the PEMRA intends to revoke the license of the appellant probably on the contravention of any provisions of PEMRA Ordinance or rules and regulations made thereunder and not otherwise. Question arises, was there any contravention noticed in the show-cause notice?
30. Let us now peruse and discuss provisions of Section 30 as a whole. “Proviso” to Section 30 applied to 30(1)(a) and 30(1)(b) whereas no such proviso is attached to Section 30(1)(d). I have already observed that contravention has not been pointed out which has scored off role of Council of Complaints as far as Section 30(1)(b) is concerned.
31. Section 30(1)(d) is in relation to transfer of majority of shares in the issued or paid up capital of the company or if the control of the company is otherwise transferred to a person not being original shareholder of the company at the time of grant of license without permission of the Authority. To this subsection (d) of Section 30(1), the role of Council of Complaints is not specified, meaning thereby that it is exclusively in between Ministry of Interior and PEMRA, if the only bone of contention was that shares were allegedly transferred without permission. This is not dependent upon any contravention for an action to be taken for revocation of license on the recommendation of Council of Complaints.
32. The previous litigation in the shape of CP No.D-2867 of 2013 was to the extent as to whether the security measures could be reopened or re-assessed which was answered by the Division Bench of this Court that it can always be, whereas the instant appeal involves a question as to the applicability of role of Council of Complaints in the given facts and circumstances. The act of transfer of shares at one point of time was purified by PEMRA itself while approving the shareholding. It may not be correct approval or may be based on erroneous conclusion drawn by the agencies or Ministries but this issue does not extend the role of Council of Complaints which is even otherwise excluded by bare reading of Section 30(1)(d) ibid, which is subsequent to the proviso involving Council of Complaints.
33. Now strictly relying on the contents of the show-cause notice, it is compliance of rule 7(d) read with Rule 9(5) of PEMRA’s Rules 2009, which were ignited, as claimed. Based on this, as alleged, Ministry of Interior regretted security clearance and the decision was based on recommendation of Council of Complaints.
34. It is worth mentioning here that the security clearance by all security agencies was granted to the present directors through a process that commenced on the basis of an application of appellant on 04.03.2013 when an application seeking permission to induct new directors was moved followed by a letter of PEMRA dated 21.03.2013 sending the names of these new directors for security clearance. The Ministry of Interior issued security clearance on 25.03.2013 (Annexure ‘H’ to comments filed by respondents No.4 (PEMRA) and 6 in CP No.D-2867 of 2013) and the PEMRA approved induction of new directors on 26.03.2013, the contents of which letters are reproduced as under:-
Letter of 25.03.2013
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IMMEDIATE GOVERNMENT OF PAKISTAN MINISTRY OF INTERIOR ***********
Subject: SECURITY VETTING – M/S LABBAIK (PVT.) LTD.
Reference PEMRA Islamabad’s letter No.10-2(44)STV-2011/590, dated 21st March, 2013, on the subject noted above.
2. Ministry of Interior has no objection for the change in Administration.
Sd/- (S. AYYAZ H. HAMDANI) Section Officer (KP) The PEMRA Headquarters (Ch. Junaid Ali Khan, Asstt. General Manager (Licensing/STV), 3rd. Floor, Mauve Area, G-8/1, Islamabad M/o Interior’s U.O. No.9/75/2013-S-III dated 25.03.2013 |
Letter of 26.03.2013
PAKISTAN ELECTRONIC MEDIA
REGULATORY AUTHORITY
ISLAMABAD
No.10-2(44)STV-2006 26th March, 2013
Subject: Change in Management of Satellite TV channel “Bol TV” issued to M/s Labbaik (Pvt.) Ltd.
Reference: Your letter No.Nil dated 4th March, 2013 on the subject cited above.
The Authority in its 82nd Meeting held on 14th March, 2013 while considering your request for change in management of satellite TV channel “Bol TV” has approved the induction of four new director i.e. Mr. Shoaib Ahmed Shaikh, Mr. Viqas Atiq, Ms. Ayesha Shoaib Shaikh & Ms. Sarwat Bashir, subject to payment of requisite fee for change of Management amounting to Rs.500,000/-
2. Therefore, M/s Labbaik (Pvt.) Ltd. is directed to deposit the requisite fee for change in management amount to Rs.0.5 Million within 30 days and also provide Updated true SECP Attested copy of Form-A and Form-29 of the company after induction of new director within 60 days of issuance of this letter.
Sd/-
(Chanduary Junaid Ali Khan)
Assistant General Manager (Licensing)
Mr. Salman Saddiq Ismial
Chief Executive Officer,
M/s Labbaik (Pvt.) Ltd.
Labbaik Plaza, C-47/C, 15th Commercial Street,
Phase II Extension, D.H.A.
Karachi.
35. How then a “subsequent withdrawal of security clearance” on 04.07.2013 was construed as a “contravention” on the part of the appellant ?
36. The Division Bench earlier while dealing with issue of security clearance in CP No.D-2867 of 2013 in response to arguments of the petitioner’s counsel therein that once the security clearance has been obtained then there is no requirement of fresh clearance, observed that this contention in view of Section 30(d) of the Ordinance could not be sustained for the simple reason that law contemplates security clearance of the management of the company. The Division Bench in the aforesaid petition has observed this with reference to the first issue triggered on 04.07.2013 and there cannot be any other opinion that the security clearance of the new management was and is inevitable and can always be subjected to scrutiny on tangible evidence. However, in the instant case the security clearance given to the new management in terms of letter dated 25.03.2013 was allegedly withdrawn on 04.07.2013 followed by letter dated 05.07.2013 on the ground, as taken by the Ministry of Interior, that its letter of 25.03.2013 has “ERRONEOUSLY” conveyed NOC when no such security clearance was properly processed. Why then a charge of “contravention of provision” be leveled against the appellant. Contravention is not defined in Ordinance so I opt to take dictionary meaning which provides as “to break” or “to disobey”. Contents of such letters dated 04.07.2013 and 05.07.2013 (available on pages 121 and 123 of C.P. No.D-2867 of 2013) are reproduced as under:-
Letter of 04.07.2013
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IMMEDIATE GOVERNMENT OF PAKISTAN MINISTRY OF INTERIOR *********** Subject: SECURITY VETTING – M/S LABBAIK (PVT.) LTD.
Reference this Ministry’s U.O of even number dated 25.03.2013, on the subject.
2. In supersession of this Ministry’s above mentioned letter the N.O.C. conveyed is hereby withdrawn/cancelled.
Sd/- (S. AYYAZ H. HAMDANI) Section Officer (KP) The PEMRA Headquarters (Ch. Junaid Ali Khan, Asstt. General Manager (Licensing/STV), 3rd. Floor, Mauve Area, G-8/1, Islamabad M/o Interior’s U.O. No.9/75/2013-S-III dated 04.07.2013 |
Letter of 05.07.2013
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IMMEDIATE GOVERNMENT OF PAKISTAN MINISTRY OF INTERIOR ***********
Subject: SECURITY VETTING – M/S LABBAIK (PVT.) LTD.
In continuation of this Ministry’s U.O No.9/75/2013-S-III, dated 4th July, 2013, regarding the above subject.
2. It is stated that this Ministry’s earlier U.O No.9/75/2013-S-III dated 25th March, 2013 erroneously conveyed NOC when no such security clearance was properly processed nor validly issued. Hence the same stands withdrawn for want of required security clearance.
Sd/- (S. AYYAZ H. HAMDANI) Section Officer (KP) The PEMRA Headquarters (Ch. Junaid Ali Khan, Asstt. General Manager (Licensing/STV), 3rd. Floor, Mauve Area, G-8/1, Islamabad M/o Interior’s U.O. No.9/75/2013-S-III dated 05.07.2013 |
37. These folds, as unfolded, could only reveal contravention on the part of the Ministry of Interior and not on the part of appellant. Security clearance no doubt is inevitable but under the present set of facts Council of Complaints would not come in picture. Rule 7(d) of Rules 2009 without any ambiguity provides a right to PEMRA to ascertain the credibility and track record of the management and the majority shareholding and management control and so also in terms of Rule 7(e) read with Rule 9(5) of 2009 Rules at inception, whereas 30(d) caters for subsequent change. It however does not include the scope of Council of Complaints in terms of Section 30(d) of the Ordinance 2002 as prima facie it relates to issues between Ministry of Interior and PEMRA.
38. Approval by PEMRA vide letter dated 26.03.2013 is alleged permission of authority under section 30(d) which was withdrawn and dealt with by Division Bench of this Court in Para 20 of judgment passed in CP No.D-2867 of 2013, which is reproduced as under:-
“20. As to the second limb of the argument that once security clearance has been obtained there is no requirement under the Ordinance or the Rules for obtaining fresh security clearance. The contention in view of Section 30(d) of the Ordinance could not sustain for the simple reason that the law contemplates security clearance of the management and not of the company as company being a fictitious person run by its management and therefore, on every change in the shareholding of a company, the investment of the existing management is taken out and the new management makes investment and at that juncture the Authority has to ensure that the security clearance of the new management is undertaken in order inter alia to find out as to whether, the funds so invested in the company as well as in payment to the outgoing directors, are not funded or sponsored by a foreign government or organization and for this purpose the security clearance on change of management at every stage is required. Even Rule 30(d) of the Ordinance 2002 itself provides that the Authority is empowered to revoke or suspended the licence of a broadcast media or distribution service in cases where the licensee is a company, and its shareholder have transferred a majority of the shares in the issued or paid up capital of the company or its control to person not being the original shareholders of the company without written permission of the Authority.”
39. I have also attempted to peruse Section 20 of PEMRA Ordinance 2002 to understand as to whether any violation has been made out and which led to sending the reference to Council of Complaints on account of any such contravention. However, I found nothing in Section 20 which could be claimed to have ignited Section 30(1)(b). Section 20(i) deals with terms of license that relates to sale, transfer or assigning of rights conferred by the license without prior permission of the authority which is being monitored by Section 30(d) of PEMRA Ordinance. Withdrawal of such NOC from the concerned Ministry should have been regulated by some rules and mechanism which is not supported by either Ordinance 2002 or rules made thereunder.
40. I have perused the rules framed under PEMRA Ordinance 2002 and similarly in terms of subsection 4 of Section 26 the Authority with the approval of Federal Government was pleased to make the rules thereunder which provide the contour line of the Council of Complaints. Rule 10 of Council of Complaints of Rules 2010 provides procedure upon recommendation of a council.
41. The show-cause notice dated 23.12.2016 does not talk about referring the matter to the Council of Complaints and similarly the decision impugned here does not disclose that the appellants were heard by authority on the opinion rendered by the Council of Complaints.
42. The PEMRA never heard the appellant with reference to the fact that matter could or could not be referred to the Council of Complaints and though the appearance was made by the appellant before the Council of Complaints it was without prejudice to their rights. PEMRA did not even heard appellant once the recommendation was made by Council of Complaints. After all it was only an opinion and recommendation of Council of Complaints whereas it was for PEMRA to apply its mind and not to be influenced by such recommendation.
43. In my view the appellant should have been heard before referring the matter to Council of Complaints and appellant should have been heard when Council of Complaints recommended its opinion, despite being the fact that there was no occasion, at least in the present circumstances in the absence of any contravention, to have referred the matter to Council of Complaints.
44. This entire process as far as Council of Complaints is concerned is thus without a mandate. Even if we exclude the opinion of Council of Complaints, the impugned decision/order dated 02.05.2017 does not expose independent application of mind. It was much dependent upon recommendation and opinion of Council of Complaints. I am also mindful of the fact that for PEMRA the letter of Ministry of Interior dated 30.03.2016 was an absolute hurdle as the security clearance was regretted.
45. The Rules relating to the “WITHDRAWAL” of such NOC referred in Para 36 above have not been prepared. Present Rules do not cater for the current situation where permission granted by PEMRA on the basis of NOC, was withdrawn.
46. The regret letter of the Ministry of Interior dated 30.03.2016 was available with the Authority when earlier litigation was pending and a statement was made before the Court. Since the matter in relation to the letter of the concerned Ministry is subjudice before Division Bench, I would not comment on it, however I cannot lose sight to the fact that such letter of the Ministry of Interior dated 30.03.2016 was suspended on 12.06.2017 and the order is being maintained by the Division Bench. The Hon’ble Supreme Court while remanding the matter to this Court has clearly directed that there was no reason for High Court to have remanded the matter back to PEMRA as there was enough material available on record for deciding the controversy instead of remanding the matter to PEMRA.
47. On exclusion of recommendation to the Council of Complaints, the only step that PEMRA could stand on is alleged letter of the Ministry of Interior wherein they have regretted security clearance. Whether any deliberation was made before the Council of Complaints with reference to that letter/decision, is also unascertainable through the impugned decision and recommendation. If that one line letter alone was sufficient for a decision to be made by PEMRA then what was the need for referring the matter to the Council of Complaints.
48. The overall effect of the facts and law discussed above is that the impugned order dated 02.05.2017 passed by respondent No.1, on the basis of recommendation of Council of Complaints and reasoning assigned to it, cannot be sustained and is accordingly set aside with the observation that the transmission of the appellant through the license may continue but it shall be subject to order in the aforesaid CP No.D-4087 of 2017 pending before Division Bench of this Court where the letter of Ministry of Interior (presently suspended) is impugned, which to me is main issue in the operation of channels through the subject license.
Dated: 26.06.2018 Judge