ORDER SHEET

IN THE HIGH COURT OF SINDH, KARACHI.

Present:-

MR. Justice Muhammad Iqbal Kalhoro J.

Justice Mrs. Kausar Sultana Hussain J.

Cr. Bail Appl No.2708 of 2023

Cr. Bail Appl. No.2846 of 2023

Cr. Bail Appl. No.2847 of 2023

08.04.2024

Mr. Farogh Naseem, Advocate for Applicant in Cr. B.A.No.2708/2023

Mr. Sheikh Jawed Mir, Advocate for Applicant in Cr. B.A. No.2846 & 2847of 2023

M/s Amel Khan Kasi and Talha Javed, Advocate for Applicant in Cr. BA No.2708/2023

Mr. Khawaja Shamsul Islam, Advocate for Complainant

Barrister Iftikhar Shah, Advocate for effectees

M/s Barrister Pasan Ali Lodhi and Sadam Chang, Advocate for effectees

Mr. Altaf Ahmed Sahar, Assistant Attorney General a/w IO Nasrullah Khan I.O. FIA CBC

O R D E R

MUHAMMAD IQBAL KALHORO J: Through these three bail applications, applicants are seeking post arrest bail in Crime No. 14/2023 of P.S. FIA Commercial Bank Circle, Karachi u/s 406, 409, 420, 109, 34 PPC r/w section 5(2), PCA, 1952, after their applications for the same relief have been dismissed by the trial court viz. Special court (Offences in Banks) Sindh at Karachi.

2. Brief facts as per FIR are that by dint of an agreement between DHA, Karachi and Meinhardt Singapore Pvt. Ltd (MSPL), a project by name “Creek Marina” located at DHA Phase VIII, Karachi was proposed to be constructed for which both the parties decided to open and maintain Escrow Account for receiving payments from the buyers etc. This account was to be subjected to audit by an independent auditor and its cash flows to be reported to DHA by MSPL quarterly. However, this condition was not adhered to and a subsidiary company of a foreign company namely Creek Marina Private Ltd (CMPL) instead was added in the sub lease as a third party for executing the said project.

3. It is actually this subsidiary company which is alleged to have opened fraudulent bank accounts in various banks: HSBC Bank, HBL Commercial Banking Branch HSBC Pakistan main branch Shaheen Complex, Karachi, (which was finally merged in Meezan Bank in 2014), Silk Bank main branch etc. in which allegedly billions of rupees collected from allottees were credited that were subsequently siphoned off mainly through cash withdrawal and foreign telegraphic transfer (FFL). Construction of the project, in the meantime, was halted and management of CMPL fraudulently invested the same amounts in another HBL account titled as “Investment plus account” in the name of Creek Marina Pvt. Ltd (CMPL). When this was complained against, an enquiry was rolled out by FIA and, accordingly, in consequence of which, the case was registered and applicants were arrested.

4. As far as role of accused Shaharyar Khalid and Faisal Hameed, both bankers and working as General Manager Asset Management (Recovery) and Regional Operation Manager respectively in FIR is, it is alleged that they, in connivance of employees of CMPL, let the said company open the account in Silk Bank without requiring the company to file mandatory documents viz. Board’s resolution, Articles of Association, Company Registration Certificate, Verified Signature on the AOF by Embassy officials, a mandatory requirement for signatories residing abroad and approval of the Board of Investment of Pakistan (BOI). It is further alleged that accounts department of the bank proceeded to open the said account by adhering to instructions regarding its status as “Post NO Debit” (PND) that means no debit allowed. Yet the account remained operational with a total Credit turnover of Rs.182 Million and a total Debit turnover of Rs.158 Million.

5. Role assigned to applicant Nudrat Mand Khan in interim charge sheet on the other hand is that he was appointed as CEO/CFO of CMPL. He was authorized by absconding accused Shahzad Naseem to represent him in the matters pertaining to Creek Marina Project. Further that not only he was covering tracks of the offence committed by Shahzad Naseem, the alleged main accused, but also was directly involved in the offence himself. And that he is one of the beneficiaries of the scam, a close confidant of Naseem Shahzad, and with his signatures the subject bank accounts were opened which were used for embezzlement of amounts.

6. Learned counsel in defense have pleaded for bail on the grounds that case against the applicants is one of further inquiry; there is no prima facie evidence connecting them with the offence; the entire case is based on documentary evidence, the evidentiary value of which is yet to be determined in the trial; the main accused, who are owners of the company are absconder being foreigner and their arrest that may lead to early conclusion of the trial is not likely to be materialized in near future; the case has been Challaned and applicants are no more required for further investigation; all the formalities were completed at the time of opening of the bank accounts the documents of which were submitted before the trial court but it chose to overlook the same; previously NAB had also taken up the enquiry on the same allegations plus cheating public at large but did not find any shred of evidence against the accused and closed the same; FBR has also scrutinized the accounts of the project time and again and has not found any illegality; and that the delay in completion of project has occurred due to various civil suits between the parties pending before this court.

7. On the other hand, learned Assistant Attorney General, I.O. and the learned counsel appearing for witnesses/affectees have opposed concession of bail to the applicant and have submitted that through the subject project hundreds of people have been duped into parting with their hard earned money; the project started in 2004 has not yet been completed even after 20 years. They have further relied upon case law reported as 2021 SCMR 387, 2018 CLD 1399, 2022 CLD 902, PLD 1992 SC 353, 2001 P Cr. L J 146, 157, 1991 SCMR 599, 2023 SCMR 1182, PLD 2021 SC 927, 2020 CLD 1434, 2009 P Cr. L J 1192, 2012 PLD 879 to support their arguments.

8. We have heard parties and perused material available on record. The gist of allegations against applicants Shaharyar Khalid and Faisal Hameed is that they were instrumental and facilitator in opening of the bank accounts by the company in Silk Bank, where they both were working, without requiring the latter to file mandatory documentation and fulfill necessary formalities/requirements and without approval of Board of Investment. When we put a question to I.O. in the course of hearing to explain the offence that is constituted by their alleged act, he submitted that it was in violation of rules and regulations of the State Bank of Pakistan, Anti-money Laundering Laws as well as the advice contained in VPID circular No.2 dated 23.09.2012 which require filing of all such documents. However, he or the learned counsel appearing for the witnesses/affectees could not come up with any specific penal provision of law under which such act of the applicants -- letting a foreign company to open a bank account in Pakistani bank is punishable -- except that it was apparently a transgression of either some SOPs or Rules, Regulation set out by the State bank of Pakistan to govern such activity. In addition to their failure to show whether any action has been taken by the State bank of Pakistan against the said bank for committing such lapse, the nearest provision of law which they could conjure up was section 409 PPC which they argued was applicable against the applicant. The said provision of law, however, deals with the criminal breach of trust and is prima facie attracted only when, in any manner, a property is entrusted to a public servant or a banker etc. regarding which he has committed criminal breach of trust. The criminal breach of trust as defined in section 405 PPC is constituted when such entrusted property is dishonestly misappropriated, or converted by the accused in his own use, or disposed of by him in violation of any directions of law, etc.

9. The allegations against the applicants as stated above are that they were instrumental or facilitator in opening of the bank accounts by a foreign company in their bank. Prima facie neither there is any allegation that some property was entrusted to them, nor that they had some dominion over any property entrusted to them by anyone, or they have dishonestly misappropriated any such property, or converted it to their use or disposed it of illegally. Therefore, application of section 409 PPC in the case of applicants in such circumstances is yet to be determined in the trial.

10. Furthermore, a perusal of the emails sent by applicants to the concerned officials of the relevant branch of the bank for opening of the account prima facie does not show any mandatory instruction by the applicants to the staff concerned for opening the bank accounts at any cost. Theirs were only referral emails requiring the bank officials to fulfill all the necessary obligations first and check the documentation before opening such accounts. The entire process qua opening of the accounts otherwise was carried out by the relevant section of the bank and not by the applicants in person. Therefore, the question whether mere providing a facilitation to a foreign company to open a bank account in their bank and writing referral emails in this connection to the staff concerned, apparently a transgression of certain rules and regulations of the State Bank of Pakistan, is an offence under any of the provisions of law, the applicants have been charged with, needs to be determined in the trial.

11. Insofar as role alleged against applicant Nudrat Mand Khan is concerned, the charge sheet shows that he was appointed as CEO/CFO PMPA and was authorized to represent the main accused Shahzad Naseem in the matters pertaining to the subject project. Further, it; is alleged that he himself is a beneficiary of the scam, and that he had opened the alleged bank accounts through which the money was siphoned off. In the course of hearing, despite our repeated queries to the IO to show us any evidence about a benefit obtained by the applicant from the scam, number of his properties, his bank accounts, turn in and turn out in his accounts, information about his life style, his kids’ schooling, his and his family’s travel record etc. to tentatively form a view that he has been beneficiary of the scam or has been involved in siphoning off the alleged amounts from Pakistani Banks to Foreign Banks, he could not say anything. All that he was able to utter was that the employees of the company have given statements that various amounts were withdrawn from the bank accounts of the company at the instance and under instructions of the applicant, which however, does not prima facie constitute any offence. He was the Chief Financial Officer/CEO of the company which had undertaken a huge project of construction, deposit of money in the bank accounts of the company and its withdrawal at the instance of applicant was a routine practice. Nothing could be gathered from it until and unless it is shown that the amounts were gobbled up by the applicant and used personally or that he or his family has in any manner gained any benefit out of it.

12. We, therefore, for want of such questions, are of the view that there are reasonable grounds to believe that the case against the applicants requires further enquiry into their guilt. In the circumstances, we allow these applications and grant bail to the applicants in the sum of Rs.One Million (ten lac) each and P.R. bond to the like amount to the satisfaction of the Nazir of this court.

The bail applications are disposed of in the above terms.

Needless to mention here that the findings made hereinabove are tentative in nature and would not prejudice case of either party at trial.

J U D G E

A.K