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June 19, 2015

SHC reserves order on Labbaik’s plea against channel NOC withdrawal

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June 19, 2015

KARACHI: The Sindh High Court (SHC) on Thursday reserved judgment on petitions of the Labbaik Pvt Ltd against the withdrawal of the NOC for the Bol TV’s four directors and the policy advice of the Ministry of Information to the Pakistan Electronic Media Regulatory Authority to ensure the stoppage of the Bol TV transmission.
The court observed that there was a logic in all public dealing laws and if the contention of Bol TV counsel that there was no requirement of security vetting for change of management is accepted, then there will be chaos and it will pave the way for inclusion of any persons in the media company without any security clearance.
Additional Attorney General Salman Talibuddin submitted that Bol News and Bol Entertainment are entirely illegal companies under Section 206 of the Companies Ordinance incorporated to run the Labbaik private company. He said that directors of Axact Shoaib Ahmed Sheikh, Ayesha Shaikh and others took Labbaik company and later incorporated Bol News and Bol Entertainment to run the management of Labbaik.
The AGP submitted that the Labbaik management obtained stay order against the withdrawal of NOC by interior ministry on July 8, 2013 and on basis of a stay order, they established the infrastructure of Bol TV worth Rs3.5 billion along with a fleet of vehicles including Mercedes Benz and equipment of TV channel without disclosing the source of income while Labbaik’s paid up capital was just Rs500,000.
Filing the details of Labbaik (Private Limited) issued by the Security Exchange Commission of Pakistan for years 2010, 2011 and 2012, the AGP submitted that the company’s paid up capital was 500,000 and it was not doing any business. He submitted that Shoaib Shaikh and other directors were inducted into the company in October 2012 as per the details of SECP record where Shoaib Shaikh was shown as the CEO of Labbaik prior to filing an application before Pemra for inclusion as new directors in the

Questioning the source of income of the Labbaik and Bol TV which still did not start any commercial activities, he alleged that money flows from Axact which was ill-gotten money. He said that as per the available record, Bol TV CEO Shoaib Shaikh and his wife Ayesha Shaikh own only one share each in the Axact company while the rest of the 99.99 percent shares was with Dubai based Axact LLC company. He said that there was no justification as to how a woman who is a house wife and not running any business were purchasing equipment of channel worth hundreds of millions of rupees. He said that as per records, the petitioner company has not sufficient finances to run the TV channel.
The federal law officer submitted that at all stages, there was a requirement of Pemra to act keeping in mind the public interest and must scrutinise as to whom the management of channel was being handed over.
Concluding the arguments, petitioners counsel Abid S Zuberi submitted that there was no requirement of security clearance under the Pemra laws for the change of management. He submitted that ministry of information could not issue direction to Pemra for stopping the transmission of any TV channel expect the due process of the law.
He said that freedom of press and expression are guaranteed under the Constitution and he suggested that matter for security clearance may be directly referred to Inter Services Intelligence instead of the Ministry of Interior as the petitioner was directly aggrieved with the respondent ministry.
Rebutting the arguments of the additional attorney general, he submitted that there was nothing to show on record that ill-gotten money was used in Bol TV nor the SECP had taken action against the Bol TV CEO Shoaib Shaikh and other directors for misconduct.
He submitted that the federal law officer levelled allegations on the petitioner and he should be given time to properly reply the same. He said that the Bol TV could not be punished on acts of Axact and prayed court to allow the TV channel to run its transmission. The court observed that security clearance was an important matter and the court may issue direction to the Ministry of Interior to decide the security clearance matter within 30 to 45 days.
Pemra’s counsel Kashif Hanif submitted that under Section 25 of the Pemra Ordinance, license of a channel could not be granted to a foreign company or a company whose shares are owned by a foreign company. He submitted that an NOC was given in haste without fulfilling the requirements and it was subsequently withdrawn by the competent authority.
He submitted that security clearance was mandatory for issuance of a TV license or change in management and prayed the court to dismiss the petitions.The Pakistan Broadcasters Association counsel, Behzad Haider, submitted for an equal treatment of the law and urged the petitioner company be directed to apply and obtain security clearance for its new owners and directors before commencing transmission of its TV channel.
He submitted that in case the petitioner was granted or allowed to commence transmission of its channel without subjecting the petitioner to the same level of scrutiny and security clearance as the one through which applicant members have gone through, it will be discriminatory and unfair to the PBA members.
The applicant’s counsel submitted that it was widely propagated by the petitioners that their security clearance was withdrawn on the instigation of the PBA and its TV broadcasting members as they are rival to them despite the fact that security clearance was withdrawn by the Ministry of Interior on non-completion of the required legal process. The SHC’s division bench, headed by Justice Sajjad Ali Shah, after hearing the arguments of the counsel reserved the judgment.

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