UNITED INSURANCE COMPANY OF PAKISTAN LIMITED vs The DIRECTOR/HOD, ADJUDICATION-I, ADJUDICATION DIVISION, SECP,

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UNITED INSURANCE COMPANY OF PAKISTAN LIMITED VS The DIRECTOR/HOD, ADJUDICATION-I, ADJUDICATION DIVISION, SECP, ISLAMABAD R.12---Insurance Ordinance (XXXIX of 2000), Ss. 156 & 167---Provisions of Takaful (Insurance), violation of---Penalty, imposition of---Appellant (Insurance Company, being authorized to undertake non-life insurance business and to carry on Window Takaful Operations /WTO), was penalized by Securities Exchange Commission of Pakistan (Commission)---Argument of the appellant was that for any violation of the Takaful Rules, 2012, a penalty could only be imposed under R. 12 of Takaful Rules, therefore, imposition of penalty by the respondent / Commission under S. 156 of the Insurance Ordinance, 2000, was without jurisdiction---Validity---Secondary legislations are made to achieve the purpose of primary legislation, therefore, Takaful Rules being a secondary legislation serve the same purpose under the primary legislation i.e. the Insurance Ordinance, 2000---Rule 12 of Takaful Rules, 2012 was not a penal provision rather it merely dealt with the revocation of the authorization, therefore, to deal with the violation of the Takaful Rules, 2012, a penal provision provided under the Insurance Ordinance, 2012, was to be applied---Notably, the authorization to carry out WTO was a permission granted by the Commission, therefore, in case of any violation, the Commission being an authorization granting authority was empowered to revoke such authorization---Takaful Rules, 2012, were made under S. 167 of the Insurance Ordinance, 2000, therefore, any Rule or Regulation made under the Insurance Ordinance, 2000, was an integral part of the Insurance Ordinance 2000, and in the absence of penal provision under the secondary legislation, penal provision provided under the primary law was to be applied--- Furthermore, the revocation of authorization could not be termed as a "penalty", therefore, the appellant's interpretation that R. 12 of Takaful Rules was a penal provision was not tenable---Appellate Bench found no reason to interfere in the merits of the impugned order----Appeal was dismissed.

UNITED INSURANCE COMPANY OF PAKISTAN LIMITED vs The DIRECTOR/HOD, ADJUDICATION-I, ADJUDICATION DIVISION, SECP, ISLAMABAD R — 2025 CLD 288 SECURITIES-AND-EXCHANGE-COMMISSION-OF-PAKISTAN

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