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TIP wants SECP to probe counter charges campaign

ISLAMABAD: Transparency International has asked the Securities Exchange Commission of Pakistan (SECP) to take action against Bahria Town Lahore on account of misguiding the general public regarding its Sectors E, D and F in Lahore as pointed out by the Lahore Development Authority (LDA).

However Bahria Town Lahore negates all the charges saying that Bahria Town sectors D and E are complete projects and the application for their approval is lying with the Tehsil Municipal Administration Iqbal Town, Lahore while Sector F was in the planning phase.

Following an advertisement by Lahore Development Authority intimating the public to be aware of the status of Sectors D, E and F of Bahria Town Lahore, the Transparency International’s advisor has written a letter to Chairman SECP urging the commission to do its job i.e. to take necessary steps and actions in favour of general public.

The letter has also been sent to Supreme Court, the Chief Minister, Punjab, with request to order LDA for action against the company under LDA Act 1975; Chairman, National Accountability Bureau; Chairman Public Accounts Committee; Federal Tax Ombudsman; Federal Minister of Finance; Auditor General Pakistan and Federal Secretary, Ports & Shipping.

Transparency International Pakistan has referred to its earlier letter dated 17th December 2012, requesting SECP to take action under SECP Law against Bahria Town on account of tax evasion determined by FTO and Bahria Town adjudicated by SECP as guilty of deceptive Market Practices in Margalla Enclave Project. Failure of SECP to act on its responsibilities to take action under Sections 230 & 305 of the Companies Ordinance 1984 against Bahria Town has given incentive to Bahria Town to continue breaking of law, the letter says.

“No action by SECP has caused another such practice by the same company, this time in Bahria Town Lahore. Public Notice Warning Public about the illegal sale of Bahria Town Phase II, Sector D, E & F, by Lahore Development Authority is published in media” says the letter adding: “TIP has also been requesting SECP since last one year that it should address the frauds and irregularities of companies doing real estate business and restore the Notification No SRO 954(1)/2003 dated October 1, 2003, which was issued in the public interest to protect them from fraudulent practices of builders and developers in 2003 to bring the real estate companies, within the ambit of the Companies (Invitation and Acceptance of Deposits) Rules, 1987 (the Rules), but was withdrawn by SECP after 6 years in September 2009 (obviously under pressure of builders and developers).”

TI-Pakistan requested the Chairman SECP to take immediate action as well as the persecution proceedings against the guilty due to tax default, if it is allowed, under the Companies Ordinance, 1984. Bahria Town, on the other hand, through advertisement in the national press, has said that it was the biggest private property developer in Asia and that the ad of LDA was misleading. It said that the Sectors D and E were complete projects while the Sector F was in the planning phase. Bahria Town stated that the application for approval of Sector D and E were lying with the TMA Iqbal Town Lahore. Bahria Town Lahore also elaborated that under Punjab Local Government Ordinance 2001, Bahria Town takes approval of its projects from TMA and not from LDA. It was also conveyed through the advertisement that LDA’s ad was misleading.