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Petitioner: Bursshane LPG (Pakistan) Ltd VS Respondent: Federation of Pakistan through Secretary / Chairman Revenue Division/ Federal Board of Revenue
Court Name: Sindh High Court Judge(s): Irfan Saadat Khan, Mahmood Ahmed Khan Title:Bursshane LPG (Pakistan) Ltd vs Federation of Pakistan through Secretary /
Chairman Revenue Division/ Federal Board of Revenue Case No.: Constitutional Petition No.D-5162 of 2020 Date of Judgment:2022-06-18 Reported As: 2022 SHC 312 Result: Petition DIsmissed Judgment JUDGEMENT Irfan Saadat Khan, J. The instant petition has been filed on the grounds that the complaint No.945/20 20 dated 31.08.2020 and the proceedings emanating from it may be declared illegal and unlawful. Moreover , the jurisdiction of the respondent No.2 was also challenged in the instant petition. 2. Briefly stated the facts of the case are that the petitioner No.1 is a listed public limited company , duly registered with the Stock Exchange. The petitioners No.2, 3 and 4 are its directors. That a complaint bearing No.945/2020 dated 31.08.2020 (hereinafter referred to as "Complaint" ) was filed under Sections 192, 192A and 203 of the Income Tax Ordinance, 2001 (hereinafter referred to as "Ordinance 2001" ) read with Sections 3, 4, 8 20, 21, 22 of the Anti-Money Laundering Act, 2010 (hereinafter referred to as "AMLA" ). Thereafter the respondent No.2 took cognizance of the said complaint in Case No.192/2020 against the petitioners, under the above referred provisions of law. In the instant petition, the petition ers have not only challenged the said complaint and its proceedings but also the jurisdiction of the respondent No.2 in proceeding with the matter . That this Court vide order dated 22.10.2020 issued pre-admission notice to the respondents as well as to the DAG and has also directed the respondents not to take coercive action against the petitioners. The petitioners however were directed to cooperate with the prosecution and attend the trial court. 3. Mr. Mushtaq Hussain Qazi, Advocate has appeared on behalf of the petitioners No.1 and 3 and stated that not only the complaint is illegal but the proce edings emanating therefrom are also illegal and unlawful. He stated that the respondent No.2 has no jurisdiction to proceed with the complaint in case No.192/2020. While elaborating his view point, he has stated that the respondent No.2 has been given the author ity by the FBR, through official gazette, to deal with the matters falling under Sections 192, 192A, 194 and 199 of the Ordinance 2001. He stated that the respondent No.5 while dealing with the complaint has no jurisdiction to act as an investigating officer as,
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according to him, vide SRO 611(1)/2016 dated 09.06.2016 it is only the Directorate General, who can investigate the matter but not the Director I&I-IR. He stated that since the very authority exercised by the respondent No.5 was illegal, therefore these proceedings are non-est in the eyes of law, hence the same may be declared as illegal and void. 4. He next stated that as per sub-sectio n 2 of section 203 of the Ordinance, only a Special Judge, can take cognizance of the matter with regard to the complaint, therefore, the cognizance taken by the Respondent No.5 in the matter is illegal. He further stated that under AMLA only ?proceeds of crime?could be taken up by a Court having special jurisdiction, whereas, in the instant matter it is not yet proved by the Department, FIA or any other authority that the amounts, as mentioned in the complaint amounting to Rs.1.775 billion, were either proceeds of the crime or the amount gained by the petitioners' company or its Directors by way of Anti-Money Laundering. He stated that under the circumstances the decisions given by the Hon'ble Supreme Court of Pakistan in the case of Justice Qazi Faez Isa and others ...Vs... The President of Pakistan and others (PLD 2021 SC 1) and by the High Court in Govind Ram ..Vs.. The Federation of Pakistan through Secretary Finance and 2 others (2022 PTD 634) are squarely applicable. According to Mr. Qazi in the case of Govind Ram (supra ), this High Court has categorically defined when AMLA proceedings could be initiated which parameters, in his view, are lacking in the instant matter . Learned counsel has further relied upon the decisions given in the cases of; i. Multiline Associates ..Vs.. Ardeshir Cowasjee and 2 others ( PLD 1995 SC 423 ) ii. Land Acquisition Collector and 6 others ..Vs.. Muhammad Nawaz and 6 others ( PLD 2010 SC 745 ) iii. Messrs WAK Limited Multan Road, Lahore..Vs.. Collector Central Excise and Sales Tax, Lahore (Now Commissioner Inland Revenue, L TU, Lahore) and others ( 2018 SCMR 1474 ). iv. Muhammad Aamir Khan ..Vs.. Government of Khyber Pakhtunkhwa through Senior Member Board of Revenue, KP and others ( 2019 PLC (C.S) 1014 SC). Mr. Qazi further submitted that since the Respondents' lack jurisdiction to proceed with the complaint therefore, this petition may be allowed by declaring the action as illegal, uncalled for and without jurisdiction. 5. In the alternative, Mr. Mushtaq Qazi, stated that the accounts of the company are being regularly audited and the company and the directors are being assessed as a taxpayer since the last a number of years and there is no complaint against the petitioner company or its Director with regard to any concealment of income etc., hence, the present proceedings initiated by way of an illegal complaint and that of alleged money laundering is illegal, as according to him neither any income or tax has been concealed nor evaded. 6. Mr. Amir Raza Naqvi, Advocate has appeared on behalf of the Petitioners No.2 & 4 and stated that in the complaint only permission to investigate the matter was obtained hence the complaint could not be considered as an FIR against the petitioners and its Directors, therefore, in his view the Trial Court has no jurisdiction either to register a case or to proceed against the petitioners and its Directors. He stated that since there was no proper legal complaint against the petitioner and its Director therefore proceedings initiated by the Trial Court are illegal. He further stated that the essence of AMLA is provided under Sections, 3 & 4 of the said Act, which parameters have not been fulfilled in the instant matter . He stated that in a case of identica l nature before Islamabad High Court, bearing Petition No.3195 of 2021, FIR was quashed. However , in the instant matter , according to Mr. Naqvi, since there was neither an FIR nor a report under Section 173 Cr.P.C therefore, this case is on better footing than the matter decided by the Islamabad High Court. 7. The learned counsel then placed reliance on the decision given in the case of Waris MEAH' s reported as PLD 1957 SC 157. He stated that since in the Income Tax Ordinance, no penal consequence of criminal nature have been provided, if there is any money laundering or tax evasion of Rs.10 million or above, therefore, according to him, the tax department has no jurisdiction to make a complaint of money laundering against the petitioner company and its Directors, which in his view is the jurisdiction of AMLA only. He stated that if parameters, as enshrined in the case of Waris MEAH' s, are considered which according to him are fully applicable in the present matter , the case of the department would crumble to the ground. He stated that Article 10 and 10-A of the Constitution protect the rights, liberty and fair trial of the citizen and placed reliance on the decision given in the case reported as Muhammad Iqbal Khan Noori and anot her ..Vs.. National Accountability Bureau (NAB) and
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others (PLD 2021 SC 916). He stated that there is no complaint again st the company or the Directors with regard to incorrect or inaccurate submission of the statutory requirements before the SECP also, who is the regulator of the company affairs. He in the end stated that in view of the above legal deficiencies the petition may be allowed by quashing the proceedings of the complaint, as initiated by the Respondents. 8. Mr. Sarfaraz Ali Metlo, Advocate has appeared on behalf of the Respondent No.3, who while taking the lead on behalf of the Respondents counsel, at the very outset, stated that instant petition is not maintainable. He stated since the matter is pending adjudication before the Trial Court and the petitioners are duly appearing before the said Court from where they have also obtained the bail, hence they may be direct ed to keep appearing before the said Trial Court and join the trial and if they are found innocent they would be acquitted by the Trial Court. Hence the instant petition, in his view, is premature and not maintainable; therefore, the same may be dismissed. He stated that Article 199 of the Constitution only comes into the picture when there is no other adequate remedy is available with a person, however , in the instant matter when an adequate remedy is available to the petitioner , by agitating the matter before the Trial Court in accordance with law therefore, filing of the present petition is unwarranted which may accordingly be dismissed with heavy cost. 9. Mr. Metlo stated that if the petitioners are innocent they can file application unde r Section 265-K Cr.P.C for their acquittal before the Trial Court, which would be considered in accordance with law. He stated that filing of this petition in his view is uncalled for and therefore, this petition may be dismissed . In support thereto the learned counsel has placed reliance on the decision given in the case reported as Muhammad Farooq ..Vs.. Ahmed Nawaz Jagirani and others ( PLD 2016 SC 55 ). 10. Without prejudice to the above, the learned counsel stated that as per proviso (a) to section 20 read with section 2(X) of the AMLA; if an adverse order is passed by the Trial Court the petitioners have the remedy to file an appeal before the High Court. He stated that AMLA being special law has an overriding effect over the Ordinance, 2001, therefore, it could not be said that the petitioners either have no remedy or that they would not be given a fair trial before the concerned Court. He stated that it is a settled proposition of law that criminal matters are not amenable in a writ petition since the same requires detailed deliberation, lengthy arguments, recording of evidence and examination of witnesses, etc., which could not be done in a writ petition, therefore, in his view a petition cannot be considered to be a substitute of the trial, therefore, the petitioners may be directed to join the trial and to assert whatever they want before the concerned Court. In support thereof the learned counsel hasplaced reliance on the decisions given in the case reported as Mir Shakil ur Rehman ..Vs.. Messrs Creek Developers (Private) Limited and another (PLD 2019 Sindh 670), Bashir Ahmed ..Vs.. Zafar-ul-Islam and others (PLD 2004 SC 298), President, All Pakistan Women Association, Peshawar Cantt., ..Vs.. Muhammad Akbar Awan and others (2020 SCMR 260) and Mohtarma Benazir Bhutto, M.N.A. and Leader of the Opposition, Bilawal House, Karachi ..Vs.. The State ( 1999 SCMR 1447 ). 11. Mr. Metlo, further stated that on identic al issue the petitioner previously filed a petition bearing CP No.D-4602 of 2020 which was dismissed with cost directing the petitioners to join the trial. He therefore, stated that filing of this petition on the same grounds is firstly misconceived and secondly is squarely hit by the principle of res-judicata. He therefore, stated that this petition therefore needs to be dismissed with heavy cost. 12. Mr. Metlo, next stated that reading of the Income Ordinance, 2001 clearly reveals that in respect of matters which concerns evasion of taxes over Rs.10 million or above, the same is refer-able to be dealt with under Special Law namely AMLA, therefore, according to him arguments of Mr. Qazi, that the Income Tax Department has no jurisdiction to deal with such type of matters is incorrect. He stated even the SROs and the notifications presented by Mr. Qazi, in fact supports his viewpoint rather than the view taken by Mr. Qazi. He stated that it is the Directorate General Office, which has been given the jurisdiction to evaluate such type of matters, which has rightly been done by the concerned Directorate. He stated that AMLA has an overriding effect over Income Tax Ordinance, therefore, there could not be a question of either overlapping of jurisdiction between the Tax Department or the Special Court as in the matters that where tax evasion is detected Rs.10 million or above, the same are refer-able to a Special Judge, as has been done in the instant matter , therefore, there could be no questio n of any wrongful assumption of jurisdiction by the Income Tax Department. In support thereof the learned counsel has placed reliance on the
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decisions given in the case reported as Dr. Sikandar Ali Mohi ud Din ..Vs.. Station House Officer and others (2021 SCMR 1486 ), Federation of Pakistan through General Manager/Operation Pakistan Railways, Headquarters Of fice, Lahore and others ..Vs.. Shah Muhammad ( 2021 SCMR 1249 ). 13. Mr. Metlo, next stated that the content ion of Mr. Qazi that there is neither any money laundering nor tax evasion involved in the instant matter , he stated that it is quite premature to utter any word in this regard as this matter is subjudice before the trial Court, hence it cannot be said that neither any tax evasio n nor any money laundering has been established against the petitioners company or its Directors as investigation is underway and only after full- fledged trial it could be said whether there was any money laundering tax evasion involved in the instant matter or not, therefore, according to him this argument of Mr . Qazi is misconceived and premature. 14. Mr. Metlo next stated if the matter , which is being adjudicated upon by the trial Court, is examined it could be seen that the trial Court after considering complaint has come to the conclusion that prima facie a case of an offence triable by the said Court has been made out and only after that cogniza nce in the matter was taken in accordance with law. Mr. Metlo explained that at no point of time either Mr. Qazi, or Mr. Naqvi, have stated that opportunity of hearing has not been provided by the trial Court while proceeding with the matter . According to him ample opportunity is being provided by the trial Court to the petitioners to put up their defense, therefore, the trial Court may be allowed to proceed with the matter in accordance with law. According to Mr. Metlo, filing of the instant petition is nothing but creating hindrance/hurdles in the fair trial by the petitioners, who appears to be afraid of the proceedings being conducted before the trial Court. 15. He next stated that the argument of Mr. Qazi, with regard to some TV programs and some personal observations etc., are also not worth consideration. He stated that each law deals with the circumstances mentioned therein. He stated that some laws are commons laws and some are special and some laws are more special. According to him though in fact Ordinance is a special law but AMLA is a more special law than the Ordinance, 2001, as it deals with specialized type of cases. He stated that the case of Waris MEAH' s deals with the proposition that the Central Government has the jurisdiction to choose how and in what manner to proceed, if dealing with different type of laws, whereas in the instant matter , it is only the AMLA, which deals with the money laundering or tax evasion cases above Rs.10 million, hence according to him Waris MEAH' s case relied upon by Mr. Naqvi doesn't help his case rather supports the view point of the department. 16. Mr. Metlo, stated that whether the trial Court has issued NBW rightly or wrongly , as objected by Mr. Naqvi, doesn't require adjudication by this Court in a writ jurisdiction and in support of his contention placed reliance on the case reported as Shoaib Ahmed Shaikh and 2 others ..Vs.. Federation of Pakistan through Secretary and others (PLD 2016 Sindh 607). He next stated that the decisions relied upon by Mr. Qazi and Mr. Naqvi are distinguishable from the facts of the instant matter . He stated that SECP has no role in the instant matter as this is a matter between petitioners and the AMLA. He next stated that reliance on the decision of Justice Qazi Faez Isa, is also misplaced, which deals with the peculiar facts and circumstances of that case. He finally stated that the instant petition being misconceived and not maintainable may accordingly be dismissed. 17. Mr. Kafeel Ahmed Abbasi, has appeared on behalf of Respondents No.1 & 2 and has adopted the arguments of Mr. Sarfaraz Ali Metlo, Advocate. 18. Mr. Ghulam Asghar Pathan, Advocate has appeared on behalf of Respondents No.4 & 5 and has stated that the petition is not maintainable as the same has been filed without exhausting the remedy available to the petitioners under Sections 265-K and 249-A Cr.P.C. Mr. Pathan, next stated that AMLA is not discriminatory as it deals with the specialized situations as provided under Section 39 of the said law. According to him AMLA has an overriding effect on other laws and it doesn't create any hindrance or impediment on other laws including Income Tax Ordinance, 2001. He stated that the purpose with each AMLA was introduced was to curb the menace of money laundering and to deal with the matters of tax evasion of Rs.10 million or above. Hence, according to him the assumption of jurisdiction by the AMLA authorities was in accordance with the law. He next stated that it is provided under AMLA that it would deal with the matters falling under Section 192, 192A, 194, 199 of the Ordinance, if referred by the Department. According to him, if the intention of the legislature was to saddle the Income Tax Department to deal with money laundering cases the present law would not have been introduced in
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2010, which shows that AMLA deals with special matters falling under its jurisdiction. Hence, according to the learned counsel the assertion of Mr. Qazi and Mr. Naqvi, with regard to lack of jurisdiction of AMLA and that of the Respondents No.2 & 5 is misconceived and is liable to be repelled. 19. Mr. Pathan, next stated that the Investigating or Prosecuting Agencies have been defined under Section 2(xviii) of the AMLA and the parameters, as provided in the above referred section, have duly been met in the instant matter . He stated that under identical circumstances, a Division Bench of this Court in the case of Govind Ram (supra) has categorically observed that the matters of AML are to be dealt with the concerned authorities rather than any other authority . He stated that perusal of said law also clearly shows that when there is "reasonable believe that a property is proceeds of crime" AMLA is applicable. He states that in the instant matter a "reasonable believe" has been found after receipt of credible information that petitioners were involved in tax evasion or money laundering over and above Rs.10 million , therefore, the proceedings were rightly initiated and according to him there is neither any jurisdictional defect nor the proceedings are coram non judice, as suggested by Mr. Qazi and Mr. Naqvi . In support thereof the learned counsel has placed reliance on the decision given in the case reported as Shoaib Ahmed Shaikh and 2 others ..Vs.. Federation of Pakistan through Secretary and others (PLD 2016 Sindh 607 ). 20. Mr. Pathan, next stated that in the instant matter onus is upon the petitioners to prove that the complaint with regard to the amounts which were evaded were not proceeds of crime, which could only be proved before the Trial Court after leading of evidence and producing necessary required details and documents. He stated that record shows that the petitioners did not cooperate with the auditors, who inquired into the matter , with the result that the auditors have categorically submitted that they cannot give any opinion as the petitioners have not disclosed true facts to them and thereafter have given up their assignment or stopped working with the petitioners. He next stated that in a writ petition bearing CP No.D-1 184/2021, before the Islamabad High Court, money laundering has been defined and if the parameters of the prese nt case are examined, it could be seen that this case squarely falls under money laundering rightly triable by the Special Judge dealing with AML matters. Learned counsel in this regards placed reliance on the decision given in the case of Slackness in the progress of pending Enquiries relating to fake Bank Accounts etc. (2018 SCMR 1851 ). He next stated that it is only the Court dealing with the AML matters which has the jurisdiction to deal with such type of case, which has rightly been exercised by the said Court, the Petitioners therefore, may be directed to join the trial in accordance with law . 21. Mr. Pathan, stated that without prejudice to his above submissions, as per his information the petitioners are not joining the trial and are creating hindrance/hurdles by agitating that their matter is pending before the High Court. According to him the High Court has categorically directed the petitioners to join the trial. He stated that if the petitioners join the trial and furnish the details and documents, as required by the trial Court, the matter would be concluded in a short span of time. 22. The learned counsel next stated that if the facts of the present matter are examined, it could be seen that the accusation of tax evasion or money laundering has been leveled by none else but by an Ex-Director of the Company , who was fully conversant with the matter and has furnished a number of documents to prove tax evasion or money laundering by the present Directors. He stated that he would not go into further details since the matter is subjudice before the trial Court but stated that the averments or accusation made by the Ex-Director namely Mr. Etrat Hussain Rizvi requires thorough investigation and inquiry , which could only be done by the trial court in accordance with law. He therefore, in the end stated that in the light of these facts and circumstances the instant petition is without any merit which is liable to be dismissed with heavy cost. 23. We have heard all the learned counsel at considerable length and have perused the record, the law, the decisions relied upon by them and have also made research on our own in the instant matter as well. 24. Before proceeding any further , we deem it appropriate to reproduce relevant provisions of law relied upon by the learned counsel for the petitioners as well as by the Respondents:- The Anti-money Laundering Act, 2010. Section 2(x) "Court" means the Court specified under section 20; 3. Offence of money laundering.-- A person shall be guilty of of fence of money laundering, if the person:--
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(a) acquires, converts, possesses, uses or transfers property , knowing or having reason to believe that such property is proceeds of crime; (b) conceals or disguises the true nature, origin, location, disposition, movement or ownership of property , knowing or having reason to believe that such property is proceeds of crime; (c) holds or possesses on behalf of any other person any property knowing or having reason to believe that such property is proceeds of crime; or (d) participates in, associates, conspires to commit, attempts to commit, aids, abets, facilitates, or counsels the commission of the acts specified in clauses (a), (b) and (c). 4. Punishment for money laundering.-- (1) Whoever commits the offence of money laundering shall be punished with rigorous imprisonment for a term which shall not be less than one year but may extend upto ten years and shall also be liable to fine which may extend upto twenty-five million rupees and shall also be liable to forfeiture of property involved in money laundering or property of corresponding value. (2) The fine under sub-section (1) may extend upto one hundred million rupees in case of a legal person. Any director , officer or employee of such legal person who is also found guilty under this section shall also be punishable as provided under sub-section (1). 8. Attachment of property involved in money laundering.-- (1) An investigating officer may, on the basis of the report in his possession received from the concerned investigating or prosecuting agency , by order in writing, with prior permission of the Court, provisionally attach a property , which he reasonably believes to be the property involved in money laundering for a period not exceeding one hundred and eighty days from the date of the order; Provided that the Court may grant further extension for a period up to one hundred and eighty days. (2) The investigating officer shall, within forty-eight hours immediately after attachment under sub-section (1), forward a copy of the order and the report referred to in that sub-section to the head…
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