ISLAMABAD, July 11: The Securities and Exchange Commission of Pakistan (SECP) has directed the Chief Executive of M/s Indus Dyeing and Manufacturing Company Limited to pay a fine of Rs10,000 allegedly for following a wrong procedure in electing directors of the company.

The charge against the CE of the company was that he got elected directors in annual general meeting by the show of hands that constituted a serious deviation from the procedure prescribed in the Companies Ordinance, 1984.

Subsequently, however, two shareholders of the company — the National Investment Trust (NIT) and Taymur Ali — reported the irregularity to the SECP, complaining that the management of the company, by taking recourse to an irregular method, had prevented them from effectively using their rights. As a result, it was asserted by them, they were excluded from the election.

Both the complainants were candidates for directorship of the said company. NIT, in fact, had forwarded the name of its nominee for the position through the National Bank of Pakistan, its trustee, for election.

Although, remarked SECP in its statement here on Thursday, the company in the hearing held by the Enforcement and Monitoring Division of SECP had “sufficiently demonstrated that the results of the election would have been no different had the proper decision been followed, yet it admitted having committed the default”.

As the NIT, one of the major shareholders of M/s Indus Dyeing and Manufacturing Company, was able to get its director nominated to the board of directors with the consent of the company, the SECP imposed a light penalty on the CE of the company under Section 186 of the Ordinance for violating the provisions of the relevant rules.