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THIS ORDER PASSED BY: ZAFAR ABDULLAH, COMMISSIONER (SCD):---.--- 1. This order is in Appeal No. 35 of 2016 filed under section 33 of the Securities and Exchange Commission of Pakistan Act, 1997 against the order dated 31/05/16 (Impugned Order) passed by the Respondent. 2. Brief facts of the case are that the Ministry of Industries and Production (MoIP) vide its letter dated 04/04/16 had informed the Respondent that Aik Hunar Aik Nagar (Company) has been paying huge perks to its Chairperson/Director Ms. Shireen Arshad Khan (Appellant) which constitutes a contravention of condition of license imposed in pursuance of Rule 6 of the Companies (General Provisions and Forms) Rules, 1985 (Rules). Details of the benefits drawn by the Appellant as given by the MoIP are as follows: Sr. No. Head of Expenses Amount in Rs. Vehicles Fuels, R&M 3,608,429 TA/DA 2,712,000 Two Drivers Salaries 833,000 Mobile Expenses 187,321 Air Travelling 121,130 Hotel Bills 77,113 Supplied finished and unfinished goods 2,040,367 Total 9,579,377 The provisions of Rule 6(4)(ii) of the Rules states that the "Payment of the remuneration for the services or otherwise to its members, whether holding an office in Company or not, shall be prohibited". Any violation of the Rules attract penal provisions as contained in Rule 35 which states that whoever fails or refuses to comply with, or contravenes any provision of these rules, or knowingly and willfully authorizes or permits such failure, refusal or contravention shall, in addition to any other liability under the Ordinance, be also punishable with fine and, in the case of continuing failure, to a further fine, as provided in section 506(2) of the Companies Ordinance, 1984 IA (Ordinance). 3. Show Cause Notice dated 15/04/16 (SCN) was issued to the Company as to why penalties for the aforesaid violation might not be imposed. The Chief Executive Officer (CEO) of the Company submitted his response vide letter dated 29/04/16 and hearing in the matter was fixed on 11/05/16. The CEO along with Finance Manager appeared on behalf of the Company and made their submissions. In order to meet the ends of justice, an opportunity of hearing was also provided to…

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