The High Court on Monday asked the government and the Securities and Exchange Commission (SEC) why Section-2 CC of the SEC Ordinance that allowed the regulator 'special power' would not be declared unconstitutional.
The section of the SEC Ordinance allows the regulator to impose any condition if it is not contradictory with Company Act 1994 or any other laws. SEC issued the circular asking directors to hold minimum shares to retain in the boards following Section-2 CC, which the market analysts describe as 'special power'.
The bench of justices Hasan Foez Siddique and Jahangir Hossain issued the rule following five separate writ petition filed by 24 directors of five companies challenging the legality of the section of the SEC Ordinance-1969.
Additional Attorney General Murad Reza said the government and SEC would have to respond to the rule within a week.
He said the petitioners had pleaded for cancellation the SEC order of minimum shareholding by directors following Section-2 CC of the ordinance, but the court issued the rule rejecting their plea.
Chief Justice Mohammad Mozammel Hossain on Sunday morning sent the petitions to this bench for hearing after it was referred to him.
The five companies who filed are NCC Bank, Markentile Bank, South-East Bank, National Life Insurane and Prime Finance.
Llawyer Dr Kamal Hossain, former Attorney General Mahmudul Islam, Barrister Akhtar Imam and Barrister Rokon Uddin Mahmud argued for the petitioners while Attorney General Mahbubey Alam stood for the SEC during the hearing.
The petitioners filed the writs at the High Court on May 22. The court had sent the matter to the Chief Justice to give the decision after hearing all sides.
These five writs were filed after the court cancelled three writ petitions filed by directors of three companies challenging the legality of the SEC circular making it mandatory for directors of listed companies to hold minimum sahres.
The writs question the legality of the Section-2 CC of the SEC Ordinance following which the market regulator had issued the circular.
The section of the SEC Ordinance allows the regulator to impose any condition if it is not contradictory with Company Act 1994 or any other laws. SEC issued the circular asking directors to hold minimum shares to retain in the boards following Section-2 CC, which the market analysts describe as 'special power'.
The bench of justices Hasan Foez Siddique and Jahangir Hossain issued the rule following five separate writ petition filed by 24 directors of five companies challenging the legality of the section of the SEC Ordinance-1969.
Additional Attorney General Murad Reza said the government and SEC would have to respond to the rule within a week.
He said the petitioners had pleaded for cancellation the SEC order of minimum shareholding by directors following Section-2 CC of the ordinance, but the court issued the rule rejecting their plea.
Chief Justice Mohammad Mozammel Hossain on Sunday morning sent the petitions to this bench for hearing after it was referred to him.
The five companies who filed are NCC Bank, Markentile Bank, South-East Bank, National Life Insurane and Prime Finance.
Llawyer Dr Kamal Hossain, former Attorney General Mahmudul Islam, Barrister Akhtar Imam and Barrister Rokon Uddin Mahmud argued for the petitioners while Attorney General Mahbubey Alam stood for the SEC during the hearing.
The petitioners filed the writs at the High Court on May 22. The court had sent the matter to the Chief Justice to give the decision after hearing all sides.
These five writs were filed after the court cancelled three writ petitions filed by directors of three companies challenging the legality of the SEC circular making it mandatory for directors of listed companies to hold minimum sahres.
The writs question the legality of the Section-2 CC of the SEC Ordinance following which the market regulator had issued the circular.
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