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do you mean tagged? - if so yes, the tag has a unique number on it that coinsides with a 'tag card' which you records the species, lenght/weight angler, line class and location on it.
This tag card is then send to NSW fisheries. now if this fish is recaptured you record the number of the tag and place a new tag in the fish and send the info into fisheries and this helps them learn about the movments and behaviours of curtain fish.
Stabbing sharks to distract others? Sounds like one of the original wives tale and an outdated one at that. I would have thought that stabbing sharks and introducing blood to the water would have only brought more sharks around.
I would have to say that from my limited experience, it is uncommon for charter boat operators to harm fish they do not intend to keep for their passengers these days. Nothing annoys most fishos more than seeing fish get "donged" for no real reason. I would suggest that there are probably much better operators out thre than the one that you ended up with.