TRG Saga: Court sends TRG back to SECP

October 27, 2026 (MLN): A Karachi civil court has rejected TRG Pakistan Limited’s (PSX: TRG) four-year-old suit against the Securities and Exchange Commission of Pakistan (SECP), removing the legal shield the company had raised against a set of regulatory show cause notices and clearing the way for the Commission to take those proceedings forward.

In a four-page order dated October 24, 2026, Senior Civil Judge-VI Karachi (South) allowed the SECP’s application under Order VII Rule 11 of the Code of Civil Procedure, 1908, and rejected the plaint in Civil Suit No. 2001 of 2025.

The suit began life in the Sindh High Court as Suit No. 1584 of 2022 before being transferred to the civil court. The court found that TRG had come to court too early, that the civil court’s jurisdiction was impliedly ousted by the special regulatory framework, and that the relief sought was barred under the Specific Relief Act, 1877. No costs were awarded.

What TRG wanted to stop

According to the order, TRG challenged multiple show cause notices and letters issued by the SECP under Sections 86, 178 and 179 of the Companies Act, 2017, referred to in the plaint as the “Impugned Actions”.

The company alleged the notices were triggered by frivolous and mala fide complaints from two of its own non-executive directors, whom it labelled “Conflicted Directors”, and that the regulator was acting as an instrumentality of those directors to disrupt TRG’s business and facilitate a hostile takeover.

TRG sought a declaration that the notices were illegal, arbitrary and void, and a permanent injunction barring the SECP from any coercive action under them.

The order does not name the two directors. The suit’s 2022 vintage, however, coincides with a public flashpoint on TRG’s board: in June 2022, Mettis Global reported TRG’s PSX clarification that a complaint filed with the SECP by director Asad Nasir, relating to matters voted on in December 2021, was “not on merit”. Whether this complaint is the one underlying the impugned notices is not stated in the order.

Why the court said no

Counsel for the SECP argued that a show cause notice is not an adverse order and decides no rights; it simply invites the recipient to explain itself. TRG’s counsel countered that the notices were ultra vires, mala fide and void ab initio, which would place them within recognised exceptions to the jurisdictional bar, and that such questions of law and fact needed evidence rather than threshold dismissal.

The court sided with the regulator on every count. Relying on the Supreme Court’s ruling in Commissioner Inland Revenue v. Jahangir Khan Tareen (2022 SCMR 92), it held that rights are not determined at the show cause stage and that the tendency to bypass statutory remedies at premature stages has been deprecated.

Citing Messrs Sadiq Poultry v. Federation of Pakistan (PLD 2025 Lahore 57), it accepted that a notice can be challenged only where the issuing authority lacks jurisdiction or acts for mala fide reasons, and found that TRG had shown neither. Its allegations of bad faith were described as vague and unparticularised.

On jurisdiction, the judge set out the ladder TRG must now climb instead of the civil court: a reply to the notice, a hearing before the Commission, review under Section 32B of the SECP Act, 1997, appeal to the Appellate Bench under Section 33, further appeal to the High Court under Section 34, and finally a petition for leave to appeal before the Supreme Court.

 Where a statute provides such a forum, the court held, civil jurisdiction is impliedly barred under Section 9 CPC, following General Manager, SNGPL v. Qamar Zaman (2021 SCMR 2094) and PLD 2021 Sindh 130.

The relief itself also failed. Section 42 of the Specific Relief Act permits declarations only of a legal character or a right to property, and the court, citing Nasim Beg v. SECP, held that a negative declaration, in effect, that TRG need not answer to its regulator, is not maintainable. Section 56(d) separately bars injunctions that interfere with the public duties of any department of the Federal Government, which the court applied to the SECP as a statutory regulator.

The sharpest line in the order is the one the court described as “directly applicable”: TRG Pakistan Limited and others v. Jahangir Siddiqui & Co. Limited, Civil Appeal No. 376/2025. That was TRG’s own case.

TRG filed it in October 2022 as Sindh High Court Suit No. 1589 of 2022, numbered just five places after the SECP suit, against JS Group companies, former chief executive Zia Chishti and his spouse, alleging they had acted in concert to cross the 30% takeover threshold without a mandatory public offer.

After transfer, the same court of the Senior Civil Judge-VI rejected that plaint on December 4, 2025, and, as Mettis Global reported on July 6, 2026, the XIIth Additional District Judge/Model Civil Appellate Court dismissed TRG’s appeal on July 1, 2026. The appellate court held that the Securities Act, 2015 is a self-contained code whose special forum ousts the civil courts. On October 24, that reasoning was turned on TRG’s second 2022 suit.

Takeover backdrop

TRG’s claim that the regulator was abetting a hostile takeover sits inside a control contest that has now run for nearly five years. In June 2025, the Sindh High Court held that TRG shares acquired by Greentree Holdings, a wholly owned subsidiary of TRG International, belonged to TRG itself, treated them as purchased by the company, and ordered an extraordinary general meeting to elect directors.

In May 2026, a three-member Supreme Court bench dismissed the appeals of Greentree, TRG International and TRG Pakistan, a decision widely read as restoring significant voting influence to Chishti, who resigned from TRG in 2021.

Days later, JS Bank acquired 81,358,289 TRG shares, or 14.92%, through enforcement of security, taking the JS Group’s combined holding to roughly 159.98 million shares, as Mettis Global reported at the time. Abroad, on July 1, 2026, a US federal court in New York refused an injunction sought by TRG Pakistan and TRG International to halt Zia Chishti-initiated litigation in Pakistan.

There is an irony in the posture. Through 2025, the SECP was criticised, including in these pages, for its silence on the Greentree structure, and in June 2025 the Islamabad High Court described as misconceived the regulator’s view that it could only direct, and not itself call, a TRG shareholders’ meeting under Section 147.

The company that once benefited from a passive regulator was, in this suit, accusing it of overreach.

A rejected plaint is appealable, and TRG may yet take the order to the appellate court, as it did in the JS Group matter. At the time of writing, Mettis Global had not seen a PSX disclosure from the company on the October 24 order.

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