Law: Companies Ordinance, 1984

Section: 218,242,476

ORDER 1. This order is in Appeal No. 39 of 2014 filed under section 33 of the Securities and Exchange Commission of Pakistan (the "Commission") Act, 1997 ("SECP Act") against the order (the "Impugned Order") dated 17/06/14 passed by the Respondent. 2. The brief facts of the case are that the examination of the annual audited financial statements for the year ended 30/06/12 (the "Accounts") filed under the provisions of section 242 of the Companies Ordinance, 1984 (the "Ordinance") by Pak Chromical Limited (the "Company") revealed that the Directors' Remuneration has not been disclosed in the Accounts. The Commission vide letter dated 26/08/13 advised the Company to furnish evidence of compliance with the provisions of section 218 of the Ordinance. In response to this, the Company vide its reply dated 23/09/13 submitted details of the remuneration paid to the Chief Executive and Directors of the Company as following: Particulars 2012 2011 CEO Directors Total CEO Directors Total Remuneration and Benefits 690,000 1,180,000 1,870,000 490,000 535,000 1,025,00 Number of persons 1 3 4 1 2 3 3. The Company failed to make out disclosures for the remuneration of the Chief Executive and Directors in the Directors' Report and also failed to provide documentary evidence substantiating that the aforesaid abstract was circulated to the shareholders of the Company within twenty one days from the date of the aforesaid variation. 4. Show Cause Notice dated 06/03/14 ("SCN") was issued to the Appellants under section 218 read with section 476 of the Ordinance, Hearing in the matter was held on 31/03/14 at the SECP Head Office, Islamabad via video-conferencing facility, Mr. Maqsood Raza (the "Authorised Representative") appeared on behalf of the Appellants and conceded the default. 5. The Respondent dissatisfied with the response of the Appellants held that the Chief Executive/Company Secretary and Directors of the Company have violated the provisions of the law by failing to make out disclosures for the remuneration of Chief Executive/Company Secretary and Directors in the Directors' Report. The provisions of section 218 of the Ordinance were not complied with and a penalty of Rs.…

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