Al Wakeelo
Your Digital Lawyer, Always on Duty
Initializing Secure Chambers
Your Digital Lawyer, Always on Duty
Initializing Secure Chambers
Official Citation: 2024 PHC 266
Court / Jurisdiction: Peshawar High Court
Year of Decision: 2023
Decision Date: 2023-12-31
Parties: Syed Masood Hussain Shah and others vs National Accountability Bureau JUDGMENT
This judicial decision was delivered by the Peshawar High Court on 2023-12-31. The matter involves proceedings between Syed Masood Hussain Shah and others and National Accountability Bureau JUDGMENT, officially reported as 2024 PHC 266. The court reviewed applicable Pakistani statutes, procedural requirements, and governing case-law authorities. The full text below contains the complete facts, arguments, and legal reasoning rendered by the honorable bench.
Case cited as 2024PHC266
Court Name: Peshawar High Court Judge(s): Ijaz Anwar, Syed Arshad Ali Title:Syed Masood Hussain Shah and others vs National Accountability Bureau
JUDGMENT
Reported As: 2024 PHC 266 Result: Order Accordingly Judgment
JUDGMENT SYED ARSHAD ALI, J.- This consolidated judgment shall dispose of the instant as well as the connected W.P No.2710-P/2024 having involved a common question of law for adjudication beside having common facts. 2. In the instant petition, Syed Masood Hussain Shah, who is the Chief Executive of M/s Maqbool Associates (Pvt) Ltd. and others the Petitioners have challenged the orders of the worthy Director General, National Accountability Bureau ("NAB") dated 13.03.2024, freezing the assets of the Petitioners followed by the order of the learned Judge Accountability Court-III, Peshawar ("Court") dated 28.03.2024 confirming the said freezing order and the subsequent order of the Court dated 18.04.2024 and 26.04.2024. 3. The present issue stems from the inquiry/investigation being conducted by the NAB in respect of alleged corrupt and corrupt practices in the execution of a project commonly known as Buss Rapid Transit ("BRT"). It is the case of prosecution / investigation that an agreement was executed between the Peshawar Development Authority ("PDA") and Messers SGEC-Maqbool-Calson JV on 14.11.2017, which is a Joint Venture of Pakistani as well as Chinese companies for procurement of a civil works of the BRT. During inquiry conducted by the respondents, it was revealed that a contract for execution of the BRT project was secured through corrupt practices and the cost of the project was illegally increased from Rs. 49.346 billion to Rs. 66.437 billion due to mismanagement and frequent changes of the designs, malpractices of the contract management by the government officials in league with Petitioners; illegal benefits were extended to the Petitioners in award of
---
## Page 2
contracts which prevented the BRT project from completion within stipulated time and resultantly caused huge loss to the government exchequer. Regarding the role of Syed Masood Hussain Shah, the Chief Executive of M/s Maqbool Associates (Pvt) Ltd, it is the assertion of the prosecution that he signed Supplementary JV Agreement with M/s Calsons, M//s SGEC and M/s China Railway 21st Bureau Group, whereby it was agreed to pay 2% of the total project cost as management fee to the Chinese lead partners and it was agreed that 100% construction work shall be executed by M/s Maqsool and M/s Calson while the respective lead Chinese M/s CR21G & SGEC firm shall be silent partner. He had submitted fake documents in respect of his company's financial position and got benefit in securing the contract for execution of BRT Project. Similar allegations were also attributed to other individual namely Imran Latif and Amir Latif, who are the Director/owners of M/S Calson. The inquiry in the case has been initiated since long which was later converted into investigation, However, how long it will take to conclude the investigation has not been provided to us. 4. Through the instant petition, the following orders have been challenged: (1) Order dated 13.03.2024. Through the said order, the worthy Director General NAB Khyber Pakhtunkhwa while exercising his power under section 12 of the National Accountability Ordinance, 1999 ("Ordinance") has ordered for freezing of 75 Bank Accounts maintained by the Petitioners at different banks and at different places i.e. Islamabad, Karachi, Toba Tek Singh etc. It is the opinion of the worthy Director General NAB in Para-2 of the said order that after perusing the record collected during inquiry/investigation, he finds that there are reasonable grounds to believe that the accused have committed the offence of corruption and corrupt practices and resultantly caused loss to the exchequer being an offence under section 9(a) of the Ordinance and schedule thereto. (ii) Order dated 28.03.2024. An application was filed by the NAB through special prosecutor for confirmation of the freezing order dated 13.03.2024 to the Court; notice was issued to the Petitioners and after hearing the parties, the Court has ordered for the confirmation of the freezing order, vide order dated 28.03.2024. (iii) Order dated 18.04.2024. On the objection petition filed by the Petitioners, an order was passed by the Court on 18.04.2024. The learned Court has slightly modified the order dated 28.03.2024 confirming the freezing order by allowing the Petitioners to operate the account in the manner that the Director General NAB should be applied through the Court and accordingly the Director General NAB shall submit the requisite amount to the court for further disbursement to the Petitioners who would be required to submit acquaintance roll to the Court. Similarly, the operation of the car leasing account was also allowed. 5. In W.P No.2710-P/2024, the allegations against the Petitioner are that the Petitioner while in Joint Venture with the Chinese firms namely M/s Beijing Santel Technology & Trading Corp and M/s Beijing EHualu Information Technology Company Limited, illegally obtained the contract for Intelligent Transport System (ITS) of BRT Project. The accused did not submit their bid till the closing dated i.e. 16.07.2018 which was extended up to 31.07.2018 in favour of the accused and thereafter opportunities given to the accused to form Joint Venture on 27.07.2018. The bid was conducted on single source. In the preset case, the following orders have been challenged before this Court. (i) Order dated 04.04.2024. Through the said order, the worthy Director General NAB KP has ordered for freezing of two bank accounts of the Petitioner at Habib Bank Limited, Corporate Brach Islamabad and Post Mall Branch, F-7 Islamabad. It is the opinion of the worthy Director General NAB that after perusing the record collected during inquiry/investigation, he finds that there are reasonable grounds to believe that the accused has committed the offence of corruption and corrupt practices. (ii) Order dated 18.04.2024. Through this order, the freezing order dated 04.04.2024 was confirmed by the learned Court vide order dated 18.04.2024 on the application of the Bureau.
---
## Page 3
(iii) Order dated 15.05.2024. On the objection petition filed by the Petitioner, it was ordered by the Court that the matter requires recording of pro and contra evidence. 6. The learned counsel representing the respondents NAB have raised a preliminary objection to the maintainability of this petition on two grounds; firstly, that an alternative remedy is available to both the Petitioners under section 13 of the Ordinance and the said remedy in form of filing of objection petition has already been availed by the Petitioners and under section 13(3) of the Ordinance, an appeal can be preferred once the objection petition is dismissed. Therefore, keeping in view the said alternative remedy, this petition is not maintainable, and secondly, this petition is premature as the objection petition filed by both the Petitioners shall be decided on merit by the Court. 7. While rebutting the said arguments of the learned counsel for the respondents-NAB, the learned counsel (s) for the Petitioners have argued that since fundamental rights of the Petitioners to do business guaranteed under Article 18 of the Constitution of the Islamic Republic of Pakistan, 1973 ("Constitution") has been seriously eroded by freezing their accounts, beside the impugned orders are patently illegal therefore, the said remedy under section 13 (3) of the Ordinance being illusory cannot be termed as an effective and efficacious remedy, hence the jurisdiction of this Court is not barred. On merit, the learned counsel for the Petitioners, while referring to the definition of assets as provided under section 5(c) of the Ordinance and the classes of offences as provided under sections 9, 10 and 12 of the Ordinance, have argued that the learned Court was first required to have decided its jurisdictional fact as the essential attributes provided for a freezing of a property in terms of section 12 of the Ordinance are not available in the present case, therefore, the said order is patently illegal. In support of their contentions, the learned counsel for the Petitioners have placed reliance on cases of "Dr. Muhammad Azam Kasi vs. The State through Deputy Prosecutor-General Accountability Court No.1, NAB, Quetta" (2012 PCr.LJ 1950), "Shah Rukh Jamal vs. National Accountability Bureau, Islamabad and others" (PLD 2022 Islamabad 1), "Dr. Arsalan Iftikhar vs. Malik Riaz Hussain and others" (PLD 2012 SC 903), "Mst. Rukhsana Bangash vs. Chairman, National Accountability Bureau (NAB) and 4 others" (2021 PCr.LJ 1813), "Messrs Memom Motors Private Limited through Genral Manager vs. National Accountability Bureau through Chairman and 2 others" (2014 PCr.LJ 1378), "Ehsan Ullah Sirazai and another vs. Director General (Karachi) National Accountability Bureau and another" (PLD2018 Sindh 696), "Haii Muhammad Arif Khattak and 2 others vs. Chairman/Director General, National Accountability Bureau and another" (PLD 2018 Peshawar 207), "Adam Amin Chaudhry and another vs. National Accountability Bureau (NAB) Islamabad through Chairman and 29 others" (2023 PCr.LJ 1536) 8. Mr. Azeem Dad, DPG and Muhammad Ali, ADPG for NAB, while rebutting the said arguments of the learned counsel for the Petitioners, have argued that the impugned orders have been passed strictly in accordance with law and the Petitioners have an ample opportunity to defend their case before learned Accountability Court as the objection petitions filed by the Petitioners are yet to be decided by the learned Accountability Court, therefore, the petitions merit dismissal. 9. Arguments heard and record of the case was perused. 10. The perusal of the record would show that the NAB has initiated inquiry in the alleged corrupt and corrupt practices in obtaining execution of contract of BRT Project which was later converted into investigation. However, what is the stage of the said investigation is not before us. The essential question before this Court is the jurisdictional factor while invoking section 12 of the Ordinance in the matter i.e. whether the worthy Director General NAB while passing the impugned orders has acted in accordance with law and both the orders freezing the assets/property/Bank accounts of the Petitioner qualify the essential attributes; as provided under section 12 of the Ordinance, and secondly, the learned Court while confirming the said order has acted judicially or has passed the
---
## Page 4
said order mechanically without apply his judicial mind. Since the matter relates to interpretation of sections 12 and 13 of the Ordinance, therefore, for ease of reference the relevant provisions along with the other provisions of the Ordinance germane to the controversy are reproduced as under: Section 5(c) of the Ordinance "Assets" means any property owned, controlled by or belonging to ay accused, whether directly or indirectly, or held benami in the name of his spouse or relatives or associates, whether within or outside Pakistan which he cannot reasonably account for or for which he cannot prove payment of full and lawful consideration. Section 5(1) of the Ordinance "Freezing includes attachment, sealing, prohibiting, holding, controlling or managing any property either through a Receiver or otherwise as may be directed by the Court or Chairman NAB, and in case it is deemed necessary the disposal thereof, by sale through auction or negotiation subject to confirmation by the Court or by Chairman NAB as the case may be after public notice. Section 12 of the Ordinance 12. Power to freeze property: (a) The Chairman NAB or the Court trying [an accused] for any offence as specified under this Ordinance, may, at any time, if there appear reasonable grounds for believing that the accused has committed such an offence, order the freezing of his property, or part thereof, whether in his possession or in the possession of any relative, associate or person on his behalf. (b) If the property ordered to be frozen under sub-section (a) is a debt or other movable property, the freezing may be made: (i) by seizure; or (ii) by appointment of receiver; or (iii) by prohibiting the delivery of such property to the accused or to anyone on his behalf, or (iv) by all or any of such or other methods as the Court or the Chairman NAB as the case may be, deem fit. (c) If the property ordered to be frozen is immovable, the freezing shall, in the case of land paying revenue, be made through the Collector of the District in which the land is situated, and in all other cases-- (i) by taking possession; or (ii) by appointment of receiver; or (iii) by prohibiting the payment of rent or delivery of property to the accused or to any other person on his behalf, or (iv) by all or any of such methods as the Chairman NAB or the Court may deem fit: Provided that any order of seizure, freezing, attachment or any prohibitory order mentioned above by the Chairman NAB, shall remain in force for a period not exceeding fifteen days unless confirmed by the Court, where the Reference under this Ordinance shall be sent by the Chairman NAB: Provided further that notwithstanding anything to the contrary contained herein, that the order of Chairman NAB or the Court shall be effective from the time of passing thereof or proclamation thereof in a newspaper, widely circulated and dispatch at the last known address of the accused either by registered post A.D. or courier service or electronic media as the Court may deem proper having regard to the facts and circumstances of the case. (d) If the property ordered to be frozen consists of livestock or is of a perishable nature, the Chairman NAB, or the Court may, if it deems proper and expedient, order the immediate sale thereof and the proceeds of the sale may be deposited with the Chairman NAB or the Court, or as either may direct as appropriate.
---
## Page 5
(e) The powers, duties, and liabilities of a receiver, if any, appointed under this section shall be the same as those of a receiver appointed under Order-XL of the Code of Civil Procedure, 1908 (Act V of 1908). (f) The order of freezing mentioned in sub sections (a) to (e) shall remain operative until the final disposal of the case by the Court, and in the event of the acquittal [or release] of the accused, shall continue to remain operative for a period of ten days after receipt of certified copy of the order of acquittal or release by NAB, where after it shall be subject to an order by the court in which an appeal, if any, is filed. Section 13 of the Ordinance 13. Claim or objection against freezing: (a) Notwithstanding the provisions of ay law for the time being in force, the Court shall have exclusive jurisdiction to entertain and adjudicate upon all claims or objections against the freezing of any property under section 12 above. Such claims or objections shall be made before the Court within 14 days from the date of the order freezing such property. (b) The Court may for sufficient cause extend the time for filing such claims or objections for a period not exceeding additional 14 days. (c) The accused or any other aggrieved party, whose claim or objection against freezing of property has been dismissed by the Court, may, within ten days file an appeal against such order before the High Court. 11. The Ordinance contains comprehensive provisions; defining the offences of corruption and corrupt practices; its investigation by setting up a Bureau known as National Accountability Bureau and the procedure for a trial of the offences. However, where no express provision is provided for the trial of an offence or inquiry/investigation, then the provisions of the Criminal Procedure Code shall mutatis mutandis apply to any proceedings under the Ordinance.[1] 12. Section 12 of the Ordinance authorizes the freezing of the assets/property of the accused facing trial or investigation, by the Chairman NAB before the final verdict of guilt by the Court. The jurisprudence on interpretation of criminal law; so far developed in our jurisdiction in unequivocal words lays down that the accused must always be presumed to be innocent and the onus of proving everything essential to the establishment of the offence is on prosecution. All that may be necessary for the accused is to offer some explanations of the prosecution evidence and if the same appears to be reasonable even though not beyond doubt and to be consistent with the innocence of the accused, he should be given the benefit of it.[2] It is axiomatic that accused is considered to be innocent unless proven guilty on conclusion of the trial and it is well settled rule that a penal statue must be construed with such strictness as to carefully guard the rights of accused and at the same time preserve the obvious intention of legislature.[3] 13. Similarly, it is also well settled that a statute which transgresses on the rights of a subject whether as regards his person or property, should be so construed, if possible, which may preserve such rights.[4] 14. Regarding the presumption against accused as provided under section 14(a) of the Ordinance, the Apex Court, while confronted with the same in the case of Mansur ul Haque[5] has held that notwithstanding special provisions of shifting of burden of proof, fundamental principle of law of criminal administration of justice that basic onus is always on prosecution to establish commission of offence is not changed. Similarly, an accused facing any inquiry or criminal investigation has the right to know the nature of the inquiry, the purpose of the investigation, and the nature of the offence for which he or she is charged. 15. Keeping in view the aforesaid canon of criminal administration of justice, we would now revert to the present controversy. Section 12 of the Ordinance no doubt empowers the Chairman or the officer of the NAB or Court trying an accused for an offence under the Ordinance to order the
---
## Page 6
freezing of his property or part thereof. However, this power is statutory in nature and not discretionary and can be exercised only if there appear reasonable grounds for believing that the accused has committed any offence under the Ordinance subject to an inquiry or investigation. Therefore, this statutory power cannot be exercised mechanically and without the essential satisfaction of the Chairman NAB as well as the Court to reach at the conclusion that there are reasonable grounds for believing that the accused has committed the offence before passing a stringent order freezing the assets of the accused. The Islamabad High Court in the case of Shah Rukh Jamal,[6] has very aptly and elaborately explained the expression "reasonable ground for believing" after referring to the opinion of the Superior Court in the case of "Fazlul Qader Choudhury v. Crown" (PLD 1952 FC 19), "Ch. Abdul Malik v. The State" (PLD 1968 SC 349, "Chaudhry Shujat Hussain v. The State" (1995 SCMR 1249, Paras 12, 13 and 14 of the said judgment are relevant which are reproduced as under. 12. The expressions 'reasonable grounds for believing' and 'reasonable suspicion' are distinct. The august Supreme Court in the case titled "(Moulvi) Fazlul-Qader Choudhury v. Crown" (PLD 1952 Federal Court 19) has considered and interpreted the expression and has observed and held that it may be that a certain amount of suspicion is caused by the conduct of a person but the word "believe" is a much stronger word and, moreover, it would require that the belief must be a reasonable one. In the case titled "Ch. Abdul Malik v. The State" [PLD 1968 SC 349] the august Supreme Court has explained the expression as follows: "Reasonable grounds" is an expression which connotes that the grounds be such as would appeal to a reasonable man for connecting the accused with the crime with which he is charged, "grounds" being a word of higher import than "suspicion". However, strong a suspicion may be it would not take the place of reasonable grounds. Grounds will have to be tested by reason for their acceptance or rejection. The reasonableness of the grounds has to be shown by the prosecution by displaying its cards to the Court, as it may possess or is expecting to possess as demonstrating evidence available in the case both direct and circumstantial." 13. The august Supreme Court in the case titled "Chaudhry Shujat Husain v. The State" [1995 SCM R 1249] has observed and held as follows: "The term "reason to believe" can be classified at a higher padestal than mere suspicion and allegation but not equivalent to proved evidence. Even the strongest suspicion cannot transform in "reason to believe." In Nisar Ahmad's case the criteria laid down seems to be that where some tangible evidence is available against the accused which, if left unrebutted, may lead to the inference of guilt." 14. It is obvious from the above discussed precedent law that having 'reasonable grounds to believe' has reference to the required evidentiary threshold. It is a legal standard and it has to be met as a precondition before exercising the intrusive power under section 12 of the Ordinance of 1999. There must be 'reasonable grounds' which manifests existence of certain essential facts. It essentially refers to the existence of such facts and circumstances which would lead a reasonable prudent person to form a belief. In the context of section 12 such belief would be relatable to the property being, directly or indirectly, owned and controlled by an accused and the latter having committed one of the offences described under section 9 of the Ordinance of 1999. The requisite standard is higher than a reasonable suspicion but less than 'on balance of probabilities'. It is distinct from conjecture, speculation or suspicion. The required standard is far less than proving something beyond a reasonable doubt. It is a threshold required for a reasonable person to conclude and be satisfied on the basis of sufficient material to conclude deprivation of or interference with the right to own, hold or control a property. The conclusion may be subjective but it must be based on some reliable material or evidence. The formation cannot be based on mere suspicion even if it may be reasonable. In a nutshell, forming an opinion On the basis of reasonable grounds to believe is distinct and a higher legal standard than 'reasonable suspicion'.
---
## Page 7
16. It is also axiomatic that any statutory authority dealing with the rights of people whether exercising judicial or quasi-judicial functions, while passing any order under any statute, it is required to give reasons for passing the said order. The said reasons must confirm that the statutory authority while passing an order has considered the matter as required by the statute conferring power to it to pass such order and it is satisfied that the said circumstances exist which are prerequisite for passing the said order nevertheless the said reasons must be reflected from the contents of the order. Any vague order of a statutory authority, though authorized under the law to pass the said order would be nullity in the eye of law. 17. In the case of R v HEFC, ex parte Institute of Dental Surgery 11994] 1 WLR 242, it is held that "The giving of reasons may in any one case be requisite. The giving of reasons may among other things concentrate the decision-maker's mind on the right questions; demonstrate to the recipient that this is so; show that the issues have been conscientiously addressed and how the result has been reached; or alternatively alert the recipient to a justifiable flaw in the process. On the other side of the argument, it may place an undue burden on decision- makers; demand an appearance of unanimity where there is diversity; call for the articulation of sometimes inexpressible value judgments; and offer an invitation to the captious to comb the reasons for previously unsuspected grounds of challenge". 18. In our jurisdiction, the said obligation on the statutory authority is embedded in section 24-A of the General Clauses Act, 1897, which envisages that where, by or under any enactment, a power to make any order or give any direction is conferred on any authority, office or person such power shall be exercised reasonably, fairly, justly and for the advancement of purposes of the enactment. It further envisages that the authority, office or person making any order or issuing any direction under the power conferred by or under any enactment shall, so far as necessary or appropriate give reasons for making the order. 19. The Apex Court in the case of Muhammad Amin Muhammad Bashir[7] has held that "Section 24-A of the General Clauses Act, 1897, reiterates the principle that statutory power is to be exercised "reasonably, fairly,…
Read the unabridged text and precedent citation network on Al Wakeelo Legal Research Platform.