PEMRA's Imposition of Surcharge for Late Payment of Fees

In Pakistan Electronic Media Regulatory Authority (PEMRA) vs. Pakistan Broadcasters Association & Others (PLD 2023 SC 378), the Supreme Court of Pakistan dealt with the legality of imposing a surcharge for late payment of fees by private broadcasters under Regulation 9(5) of the PEMRA (TV/Radio Broadcast Operations) Regulations, 2002. The Court upheld the Sindh High Court's decision, declaring that the surcharge imposed by PEMRA was ultra vires (beyond the powers) of the PEMRA Ordinance, 2002, as there was no statutory provision authorizing PEMRA to levy such charges.

Background:

The dispute began when PEMRA issued show cause notices to private broadcasters (respondents) for the late payment of annual fees from 2004 to 2011, demanding a surcharge based on Regulation 9(5) of the 2002 Regulations. The broadcasters challenged these notices, arguing that the regulation imposing a surcharge was not sanctioned by the PEMRA Ordinance, 2002.

The Sindh High Court allowed the constitutional petition filed by the broadcasters, holding that Regulation 9(5) lacked legal backing under the Ordinance and setting aside the surcharge demand. PEMRA appealed this decision to the Supreme Court, arguing that the surcharge was justified under Sections 29-A and 30(1)(a) of the amended PEMRA Ordinance, which included provisions for recovering "other charges."

Key Issues:

Legal Authority to Impose Surcharge: Whether PEMRA had the legal authority under the PEMRA Ordinance, 2002, to impose a surcharge for the late payment of fees.

Validity of Regulation 9(5) of the 2002 Regulations: Whether Regulation 9(5), which provided for the imposition of a surcharge for late payment of fees, was valid under the PEMRA Ordinance, 2002, and the 2002 Rules.

Interpretation of "Other Charges" under the Ordinance: Whether the term "other charges" in Sections 29-A and 30(1)(a) of the PEMRA Ordinance, as amended in 2007, could be interpreted to include surcharges for late payment.

Court's Analysis:

Lack of Authority to Impose Surcharge: The Supreme Court found that PEMRA did not have the authority under the original or amended PEMRA Ordinance to impose a surcharge on late payments. The Court noted that the Ordinance only provided for the collection of a license fee and annual fees but did not include any provision for surcharges. The amendments to the Ordinance in 2007 did not retroactively validate the 2002 Regulations or grant PEMRA new powers to impose surcharges.

Ultra Vires Regulation 9(5) of the 2002 Regulations: The Court held that Regulation 9(5) of the 2002 Regulations was ultra vires because it was created under the 2002 Rules without any enabling provision in the Ordinance itself. The rule-making power in the Ordinance did not extend to creating regulations that imposed surcharges, and the subsequent amendment to allow for regulations did not apply retroactively to validate the 2002 Regulations.

Interpretation of "Other Charges": The Supreme Court dismissed the argument that the term "other charges" in Sections 29-A and 30(1)(a) of the Ordinance could include surcharges. It clarified that "other charges" are not defined in the Ordinance and, even under a broad interpretation, could not be stretched to include penalties or surcharges for late payment, particularly in the absence of explicit statutory authority. Fiscal statutes are to be interpreted strictly, and there was no legislative intent to authorize PEMRA to levy such surcharges.

Court's Conclusion: The Supreme Court dismissed the appeal, affirming the Sindh High Court’s judgment that the surcharge imposed under Regulation 9(5) was beyond PEMRA's legal authority and thus void. The Court reiterated that any fees or charges collected by a regulatory authority must be explicitly authorized by statute, and in this case, the PEMRA Ordinance did not provide such authorization.

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